ICT AM Session Methodology

The 7AM Rule

"At 7 o'clock in the morning, that begins your hunt for relative equal highs or relative equal lows."

Core Definition

"At 7 o'clock in the morning, what you're doing is you're that's your that's your beginning of the day. You're now starting to look for relative equal highs and lows."

"That's your punchin time. Okay? That's the earliest you can refer to in price."

7 O'clock Vertical Line

"You want to put a vertical line on that. It doesn't need to be a very bold color or anything like that. You want to just be able to annotate 7 o'clock."

Time Framework

⚠ Critical Rule

"You don't want to look at anything prior to 7:00 because you are not versed in anything with the London session. I'm not expanding your your your focus and time beyond the scope of 7 o'clock in the morning, New York local time."

"Do not look for your relative equal highs or lows prior to 7:00."

"The rules are very simple. You're waiting to see relative equal highs and relative equal lows form after, post 7 a.m. New York local time."

London Session Reference (Advanced)

"If you're looking at prior to anything at 7:00 in the morning, what you're really doing is you're referring to London Sessions price data and its profile."

📊 London Range Definition

"The London range is whatever the highest high and the lowest low was between 2:00 in the morning and 5:00 in the morning, Eastern Standard Time."

"AM session characteristic is always first and foremost characteristic is retrade back into the London range."

The Process

"So, this starts the hunt for at 7 o'clock. Did we create a relative equal high yet? No, we just have one singular high. Do we have relative equal lows?"

1
Start at 7 AM New York Time "At 7 o'clock in the morning, that begins your hunt for relative equal highs or relative equal lows."
2
Hunt on 15-Minute First "And you start on what time frame first? The 15 minute time frame."
3
Mental Note Only "All you're doing is you're making a mental note of it. You're not annotating your chart because it's not there."
4
Wait for Setup to Form "Don't predict the setup. You have to wait for the setup. You have to wait for these signatures to form in price. You cannot anticipate them."
⚠ Do Not Lead Expectations

"You never never never lead your expectations with something that has not actually formed in the chart."

Time Frame Hierarchy

"So, you work from the 15-minute time frame, look for relative equal highs, relative equal lows after 7 o'clock in the morning."

01
15-Minute Time Frame

"What you're doing is you're looking at time first." – Start here for initial hunt.

02
5-Minute Time Frame

"These two lows may be a factor for the five-minute chart. So, we're going to go to the five-minute chart."

03
1-Minute Time Frame

"So, we go down to a one minute chart... And here is the 7:00 delineation. And you're looking for relative equal highs."

"But the fractal element is only repeating and verifiable on the time frames I'm teaching you to focus on right now. We're not going anything higher than the 15-minute time frame."

Liquidity Engagement

"All you're doing is you're looking for areas where they can stop people out and go the other direction. That's essentially all you're doing."

Liquidity Engagement: Smooth to Jagged
7:00 AM High 1 High 2 Relative Equal Highs "area that's smooth" "made it jagged" BUY STOPS "where did it go directionally? Lower." ENGAGEMENT: "This was an engagement for liquidity"

"There's two different characteristics in price delivery that is a very very simple perception of what price has done. It took an area that's smooth and made it jagged."

"This was an engagement for liquidity. So what did it do? It took buy side. After it took that buy side, where did it go directionally? Lower."

Relative Equal Highs - High Probability Signal

"How do you know it's a high probability relative equal high? When the right side that is identified as a potential turning point for a quote unquote potential relative equal high, the right one is going to be slightly lower than the one on the left."

What You're Looking For

"You're looking for little periods of price action where obvious highs can be targeted, obvious lows can be targeted for liquidity purposes."

"You're watching to see how it attacks or tracks to a relative equal low or relative equal high."

Annotating Inefficiencies

"Once you have either pan through and either identified what's available on any one of those time frames, or if there is none that's obvious, then what you do is you go through your charts and you annotate all of the inefficiencies."

"And in between them, or if there's nothing new to work off of, then you focus on all of the fair value gaps, the inefficiencies."

SIBI - Sellside Imbalance Buyside Inefficiency

"A down close fair value gap is a cibby. Stands for sellside imbalance buyside inefficiency. That means it offered delivery on the downside."

BISI - Buyside Imbalance Sellside Inefficiency

"A upclose candle right here. This is the opposite which is a bissy b i si buy side imbalance sellside inefficiency."

Fair Value Gap Structure
SIBI (Down Close) Candle 1 LOW → FVG Down Close Candle 3 ← HIGH BISI (Up Close) Candle 1 HIGH → FVG Up Close Candle 3 ← LOW

"It's inefficient in any movement back up inside that same range that creates this one single pass through until you get into this area here."

"Anything above this high up to this candlesticks low right there, that candlestick's low, all of that is inefficient and is inviting the opportunity for price to want to trade up into it."

The Real Support and Resistance

"So if you want to talk about support and resistance, these inefficiencies are the real support and resistance in price action."

"You'll see them kiss them, turn on a dime, go right to the level, stop, turn around, the bodies of them stop. Like, it's it's so precise."

Volume Imbalance

"The volume imbalance is as if the separation between one candlestick's body and the very next subsequent candlestick. If the bodies don't overlap or at least touch, there's a volume imbalance there."

Volume Imbalance Structure
Body 1 Body Bottom VOLUME IMBALANCE Body 2 Body Top "If the bodies don't overlap or at least touch, there's a volume imbalance there."

"And it is very very influential in terms of reading price action in terms of precision elements. You have to incorporate that."

Wicks and Volume Imbalance

"The volume imbalance tells you to ignore any of the wick. This wick will not be all that influential."

"So the volume imbalance right there that tells you if you have that and any wick in there just completely disregard it only if it's a wick that's that's below the consequent encroachment which is the halfway point here. So any wick that reaches up to that level or less ignore any of those wicks. You have to take it to the body of the candle."

🖍 Wick Analogy

"It's like your child that colors with a crayon in a coloring book. They color sometimes outside the lines. You know that they messed that up."

"Well, that's how I look at wicks. Yes, the algorithm repriced up into there a little bit. That's fine. Where's the body? Right there."

Inversion Fair Value Gaps

"All of my PDAs have an inversion aspect to them. Every single one of them. Every single one of them can reverse their role. Every single one of them."

"Inversion fair value gaps, the highest form of precision, the ones that are really, really trustworthy, the ones that have the highest degree of working in your favor, depends on your understanding of what I taught you yesterday and what I'm what I'm building on here."

Context for Inversion

"Whereas, we have an area that's smooth after 7 o'clock. So, the 7 o'clock in the morning starts the AM session. So now you start hunting on the 15-minute time frame, the five minute time frame, and the one minute time frame. You're hunting relative equal highs and lows to form after 7:00."

Inversion Fair Value Gap After Relative Equal Highs
POST 7:00 AM Relative Equal Highs "right one slightly lower" STOPS BISI INVERSION LEVEL Inversion FVG "role reversal" ⚠ DO NOT use BISI as a buy after stop hunt "you might be lulled into thinking... go long" BREAKER
⚠ Do Not Use BISI as Buy After Stop Hunt

"If you don't understand what you're looking for and you don't have the element of time, Dave, and you trade back down into this fair value gap, you might be lulled into thinking, well, wow, you know, this is an opportunity for me to take one of those ICD fair value gap buys and go long and then it's to your detriment that it reverses and and collapses on you."

"That is an inversion fair value gap. So the market creates this fair value gap after this run here. You don't want to use that as a buy."

Using the Inversion

"If that's the case, your eye goes into this price run. Is there a fair value gap there? If there is, extend it forward and then wait for it to trade up there."

"Don't sell yourself short and only look for the return to the breaker or the low point because it's going to trade right back up into that."

Focus on SIBI When Bearish

"And once you have a a valid return here and it sells off, what you should be focusing on is all of the cibbies. All of the cibies until the narrative is likely to change bullish."

"Your focus goes to only looking for sellside imbalances. That means a down close candle that has a segment with the previous candle's low and the subsequent candle after it is has a high that doesn't connect. And the only bridge between those two points is the down close can lo in between. That's your fair value gap."

Psychology & Mindset

"Experience will be given to you by exposure and repetition. That's the only way you glean the experience. You have to do these things and they are monotonous. They're boring. They feel like they're fruitless in the beginning."

"It feels like what am I even doing this for? And that's why I'm talking to you this way because you're going to want to not do this."

💪 Deferred Results

"But you have to submit yourself to the process that these results that you're wanting, you're going to have to wait for them. But you're still going to have to do a lot of work every single day working towards those results that will come later on."

"Those results are a deferred result."

The Algorithm

"You're going to find out that there really is an algorithm. And it really is absolutely 100% manipulated and controlled and scripted until they manually intervene."

"What are they referring to? They have, if it's an algorithm, it has to refer to something it's happened in the past."

"So what I've done is I've created a language where you're either going to be reaching for old highs for the express purposes of taking out or engaging that liquidity that would be resting above it in the form of buy stops or going below a a low or equal lows for the express purposes of going down to engage the sell side of it or sell stops."

Not Support and Resistance

"I'm not a support and resistance trader. I don't teach my students to trade support and resistance. We look for liquidity and inefficiencies."

Study Flashcards

What time begins your hunt for relative equal highs or lows?
"At 7 o'clock in the morning, that begins your hunt for relative equal highs or relative equal lows."
What time frame do you start on?
"And you start on what time frame first? The 15 minute time frame."
Should you annotate potential setups before they form?
"You never never never lead your expectations with something that has not actually formed in the chart. Don't predict the setup. You have to wait for the setup."
What is a SIBI (Sellside Imbalance Buyside Inefficiency)?
"A down close fair value gap is a cibby. Stands for sellside imbalance buyside inefficiency. That means it offered delivery on the downside."
What is a BISI?
"A upclose candle right here. This is the opposite which is a bissy b i si buy side imbalance sellside inefficiency."
What is a volume imbalance?
"The volume imbalance is as if the separation between one candlestick's body and the very next subsequent candlestick. If the bodies don't overlap or at least touch, there's a volume imbalance there."
What should you do with wicks when there's a volume imbalance?
"The volume imbalance tells you to ignore any of the wick. This wick will not be all that influential."
How do you identify a high probability relative equal high?
"When the right side that is identified as a potential turning point for a quote unquote potential relative equal high, the right one is going to be slightly lower than the one on the left."
What happens to a "smooth" area when liquidity is engaged?
"It took an area that's smooth and made it jagged."
What is the London range?
"The London range is whatever the highest high and the lowest low was between 2:00 in the morning and 5:00 in the morning, Eastern Standard Time."
What is the AM session's first characteristic?
"AM session characteristic is always first and foremost characteristic is retrade back into the London range."
What do these inefficiencies represent?
"So if you want to talk about support and resistance, these inefficiencies are the real support and resistance in price action."
What should you focus on when bearish after a valid return to inversion?
"And once you have a a valid return here and it sells off, what you should be focusing on is all of the cibbies. All of the cibies until the narrative is likely to change bullish."
What do you look for instead of support and resistance?
"I'm not a support and resistance trader. I don't teach my students to trade support and resistance. We look for liquidity and inefficiencies."
How do you gain experience?
"Experience will be given to you by exposure and repetition. That's the only way you glean the experience."