Market Maker Models - ICT's Final Public Teaching

Definition - Market Maker Models

"this is one of the closest viewpoints to how I actually trade now when I say that don't gloss over at thinking well you know that's all well and good what what does that mean it means that you have to understand all the PD arrays"
(0:28 - 0:51)

"99% of the time when I'm taking a trade it's usually something like this that's the framework behind it"
(4:22 - 4:28)

"this teaching is my market maker models it's algorithmic price delivery in institutional price swings"
(5:13 - 5:20)

"I guess in a lot of ways this is just basically my interpretation and creating a language around swing Trading"
(5:23 - 5:30)
What is Swing Trading (ICT's Definition)

"when I say swing trading what I'm referring to is if I'm bullish I'm trading from discount to premium riding the code tailes of buy side delivery if I'm bearish I'm trading from premium to Discount writing the coat Tales of sside delivery"
(5:32 - 5:48)

Prerequisites & Context

CRITICAL REQUIREMENT:

"you have to understand all the PD arrays you have to be familiar with them because what you may or may not realize is a market maker model is relying on your understanding of every PD I've made available"

(0:48 - 1:05)

"if you don't know what a breaker is if you don't know what a mitigation block is if you don't know what a inversion fair value Gap is the observation of seeing it real time as a market maker buy or sell model May Escape you at the time when you're looking at Price action live"
(1:16 - 1:32)

"this is going to be very difficult for a lot of you and I'm not going to Sugar Cod that um when I taught my private mentorship students I told them that you these are things that are going to require you to know all the things that I taught in mentorship"
(2:10 - 2:26)

"there's going to be multitudes of Market maker sell and buy models that are going to escape you you won't see them until after the fact but don't discount that as wasted opportunity log them Journal them mark them up okay and then annotate them in a way where it looks like you seen it coming in journal just like that"
(2:30 - 2:48)
Advanced vs Elementary Models

"this is probably going to go over your head and that's a normal thing okay it's it would be considered a little Advanced and and that's why I'm saying it's it's the closest thing to how I internalize price action when I'm engaging it"
(4:09 - 4:22)

"if you're not inspired to try to trade like me and you just want to trade a silver bullet or a model 2022 and that's all that you're interested in and you're content with being successful with that wonderful you do not need to have this level of understanding"
(7:22 - 7:34)

Buy Side Delivery vs Sell Side Delivery

The Critical Distinction

"when I mentioned buy side and sside you're thinking liquidity and I'm going to draw a distinction between the liquidity and the delivery"
(5:51 - 5:58)
Buy Side Delivery

"this whole idea from this run up to that level there this is what I refer to as buy side delivery okay so when price is running higher it's offering buy side it's giving the marketplace buy side as it's running higher"
(10:30 - 10:48)

"the distinction here is the directional movement when it's going higher prices in a buy side delivery"
(11:01 - 11:06)

Buy Side Delivery: "the actual animated movement of price moving higher" (11:31 - 11:37)

Buy Side Liquidity

"liquidity above a single or a group of highs that is buy side liquidity that's orders that are pending whether they be a buyer to break out and go long or to protect a short position so liquidity is a stagnant price level or levels where stops would be reside"
(11:10 - 11:31)
Sell Side Delivery

"when we're looking at Price going lower this here is what I refer to as sside delivery"
(11:39 - 11:45)
Market Purpose - Two Primary Reasons

"markets go up for two primary reasons one it goes up to engage buy stops which is buy side liquidity or it goes up to an inefficient"
(14:19 - 14:29)

Buy Side of Curve vs Sell Side of Curve

The Most Advanced Form

"the most advanced form of it would be to buy it during the buy side of the curve and then short it during the cells side of the curve that is very Advanced and while I do have students that can do that like me not many of them can"
(9:10 - 9:24)

"they can either trade the long side of the side of the curve or they can sell short on the cell side of the curve so it's a matter of them picking what they can see clearly based on their present understanding and their experience"
(9:27 - 9:39)
Buy Side of the Curve

"this hypothetical invisible line where the market trades up during buy side delivery trades into our Target where we anticipate the likelihood of a reversal if the market starts to reverse then we use the highest high that it forms to the left of that is what the buy side of the curve that means everything leading to buy side delivery"
(47:02 - 47:23)
Sell Side of the Curve

"now on the left side is what the sell side of the curve that means we're in sells side delivery what is sells side delivery going to be aiming for the original consolidation low why because it wants to repic under the original accumulation for sell side liquidity"
(47:26 - 47:38)
Using Buy Side Arrays in REVERSE on Sell Side of Curve

"I've said that the buy side of the curve used in Reverse in the cell side of the curve meaning what this down closed candle is a bullish order block so while we were going up when it drops back down into this it should be offering what support so when we get to the other side of the curve which is to the right of this imaginary line which is divided by the highest high where we anticipate anticipate seeing the market reverse on the right side of the curve that's the cell side so anything on the right side of the curve that was offered as support or as a discount array needs to start acting as what a premium array or resistance"
(51:47 - 52:27)

"buy side of the curve used in reverse on the sell side of the curve meaning what this down close candle what was it a bull shoulder block on the buy side of the curve but now we're on the left side of the curve everything should be going lower"
(52:56 - 53:09)

Original Consolidation

Definition & Identification

"when I call a original consolidation that is where the market is accumulating"
(26:31 - 26:35)

"I seen these two candles here and then the body of this one and the body of this one so right away my eye jumps to that because it's what it's a smooth edge so I want to use that as the high of the original consolidation what's the low the lowest low see how easy that was"
(26:37 - 26:53)

"when I'm looking at the original consolidations I'm looking for a repetitive overlapping or reoccurrence of a level that's being constantly referred back to inside of consolidation"
(26:56 - 27:03)
Leaving the Original Consolidation

"when we can frame the original consolidation properly then once we leave it how do we how are we leaving it here look at the body right there yeah we had a wick here we had a wick right there too but look at the body St inside that original consolidation see that that's characteristic to algorithmic price delivery"
(31:15 - 31:31)
Return to Original Consolidation

"the original consolidation it can leave it it doesn't have to touch it but if it does that's usually a trade so this would be your your original entry okay so you could go long there but sometimes it won't offer a return back to the original consolidation so it might just need a higher order entry"
(32:10 - 32:29)

"what's it doing it's returning back to the original consolidation that's how I teach my market maker in sell model and buy model the original consolidation it can leave it it doesn't have to touch it but if it does that's usually a trade"
(32:04 - 32:17)

Accumulation & Distribution Stages

First Stage Accumulation

"this drop down that could be if you're not seeing the original consolidation correctly and this would be your original entry or uh your first stage accumulation"
(37:10 - 37:21)
Second Stage Reaccumulation

"then this would be second stage reaccumulation here and it rallies up but if you don't for the sake of those individuals that wouldn't have it identified correctly in terms of how big the original consolidation is when it leaves it and when it comes back down in I'm making allowance for that"
(37:21 - 37:37)

"the bullish order block here would be your first stage accumulation for you is it wrong to classify it this way no it's based on your understanding they're both correct based on the level of experience and knowing what you're doing"
(37:47 - 38:00)
First Stage Distribution

"your bearish breaker that is your first stage distribution"
(48:24 - 48:28)

"you want to wait for the smart R reversal you want to see a lowrisk short does it show a willing to want to run away wonderful that's tape reading now you have a fair value Gap and you have a breaker trades up into it Go short that's your first stage distribution"
(48:31 - 48:44)
Second Stage Redistribution

"the market rallies up here into a bearish order block which is the up close candle here trades into it digs into half of the body right there that's mean threshold so that bearish order block is your second stage redistribution"
(49:40 - 49:53)

"this is going to be the fastest elevator ride of the move going down now it doesn't mean it won't be a you know a sharp drop consolidate sharp drop consolidate sharp drop that it can do that but this is the one you want to be entered on because if usually if you miss this one you're probably going to be chasing price"
(49:57 - 50:14)

"instead of saying this one is your second stage redistribution which means it's going to be the highest degree of speed magnitude and impulsiveness to go lower quicker"
(51:05 - 51:14)

Balanced Price Range

Definition

"we're looking at a balanced price range a balanced price range is where the market has both a downside and upside or sells side delivery and buy side delivery that overlap one another in the same relative range in price"
(24:34 - 24:49)

"you can see how this candle's high that candles low that would normally be what a sell sign balance byy sign and efficiency but look what's happened over here we have a high a big up closed candle and this candle's low so what does that make this a bid balance cell efficiency so there's an overlapping between a CBI and a bissy within the general area of the same price range"
(24:55 - 25:17)
Trapped Traders

"these are trapped Traders okay this in here is a trap Trader or trap traders that would have been caught short"
(25:24 - 25:34)

"when we have a big decline large range candle that's down and then eventually not like months later not weeks later but when it's a big drop and a handful of candlesticks like this it's not a whole lot of candles then eventually you know rip back higher that means that this was someone that's been caught their short and they quickly repriced and leave them down there"
(26:03 - 26:22)

"all the price ACS and below it I would view that as trap Trader so that means by itself that gives me narrative that it's probably going to go higher"
(26:38 - 26:45)

Unicorn Setup - Second Stage Redistribution

"that's a unicorn okay unicorn is second stage redistribution in a cell model Market maker cell model"
(41:02 - 41:12)

"when I say unicorn meaning everything's in your favor you got everything behind you it's just so it's so one-sided and you can see it It's usually the most energetic um swing high that it drops down from if you've classified everything correctly and everything to the left on the B side of the curve is identified correctly and you have everything labeled right and you have time and price in agreement with you chances are you're probably going to Ride the Lightning which is really quick sudden drops and it's real fun to be in those low resistance liquidity runs"
(41:13 - 41:42)

"that's one of the most qualifying factors in my trading and how I teach it to my students is to find the easist highe speed low resistance liquidity runs they're going to always be the second stage redistribution in a market maker sell model which is what this is right here"
(41:44 - 42:01)

Unicorn = Second Stage Redistribution in Market Maker Sell Model

Everything in your favor

Most energetic swing high

Everything on buy side of curve identified correctly

Time and price in agreement

Results in "Ride the Lightning" - quick sudden drops

Highest speed, low resistance liquidity runs

Smart Money Reversal

"this is what I refer to as a smart money reversal you are years away from ever being able to do that consistently I promise you that's not me trying to talk down to you it takes a great deal of understanding of knowing what it is that we're trying to do here because essentially what you're doing is you're picking the tops in bearish markets"
(43:33 - 43:50)

"did you hear what it just said we're picking the tops in bearish markets I'm not afraid of that I don't try to discourage that of my students but I do absolutely discourage that in my own trading when it's a bull market I'm not trying to pick the top because they're always going to go well beyond what I think and what you think it's going to do"
(43:54 - 44:13)

"but when we're bearish we can really get refined and trade the tops in bare markets because they're predictable they have a characteristic they have a a Rhyme or Reason as to why price should be behave a specific way versus when you're in an extremely bullish Market how do you know I don't know every single time that they won't go in there and intervene one more time and drive it one more time higher that's why it's dangerous to try to pick tops in Bull markets"
(44:15 - 44:39)

"but when the market is predisposed to go lower and you have all these types of characteristics in Play It's rather simple to anticipate where the Market's going to run create an extreme and do a smart money reversal but that easy perspective I'm talking about that comes with 30 years experience"
(44:41 - 44:58)

WARNING - Years Away From Mastery:

"it's going to take a long time and I mean long time for you to be able to see smart money reversals as your entry points okay but you don't need that anticipate it being there and then once it does the market breaks lower"
(45:03 - 45:17)

After Smart Money Reversal - Lower Risk Entry

"any rally back up look at the bodies here okay that is what that's consequent encroachment of the 60-minute fair value Gap CBI that's your lowrisk short we're trusting that we've already mohawked above here with these Wicks so now we're back down in here so any any attempt to trade in the middle point of this shaded area here that could be your lowrisk short"
(45:19 - 45:36)

Time and Price in Agreement

"one of the wonderful elements that's not been discussed so far but I mentioned briefing in the beginning of the discussion is when everything with price is in agreement with time because time sets the stage then price does the act of precision so it's time and price"
(54:11 - 54:29)
Market Reversal Profile - London Open to New York Open

"we have consolidation we leave the consolidation come back in return to original consolidation when does that occur London open rallies up right in here we have an order block right there and then we have what it rips into the buy side trading up into New York open 7 o'clock in the morning there's your Market reversal profile part of a market maker sell model"
(54:33 - 55:03)
London Close - Target Arrival Time

"if the whole idea was to run up have a market reversal profile and we have a market maker sell model here this Dro down below these relative equal lows here what time can it arrive when can it arrive at the target of reaching below that London close 10 o'clock to noon New York local time 10 o'clock to noon friends and neighbors that's not random"
(56:44 - 57:11)

Integration with Other ICT Models

Silver Bullet Model

"this right here trading up into that that is the 7 o'clock in the morning to 9 o'clock in the morning New York open Kill Zone Silver Bullet"
(55:45 - 55:52)
Model 2022

"this right here is model 2022 buy side taken shift in Market structure fair value Gap go short that's M 2022"
(55:29 - 55:41)
Optimal Trade Entry (OTE)

"we have a breaker we have a bearish order block all within what the New York open Kill Zone this is also op trade entry right there"
(55:17 - 55:29)
Kill Zones

"you want to trade as little as an hour a day okay I I told you that you want to trade a full Kill Zone two hours three hours okay I've told you that too I can't trade New York I got to trade London okay I told I told you how to trade that all these things are there"
(56:21 - 56:38)

Market Maker Models Contains:

Silver Bullet (7am-9am NY Kill Zone)

Model 2022 (Buy side taken + MSS + FVG)

Optimal Trade Entry (Breaker + Order Block in Kill Zone)

Market Reversal Profile (London Open to NY Open)

Time-based targets (London Close 10am-12pm)

ICT's Farewell Message

"I've been very honored to be your Mentor here I've been honored to be a conduit to share all these things that I've collected and authored over the last 30 years it's been a wonderful experience I've been touched by so many of you as students I have been moved to tears for some of you with all the uh adoration and respect you've shown to me and I'm so thankful for that"
(57:27 - 57:51)

"but like all things all good things must come to an end and I am married to a woman that demands more of my personal time and social media and mentoring has taken a great deal of that so I want you all to know that it has been a pleasure to be able to be in this seat as a teacher as a a role model for learning how to trade and read price action"
(57:51 - 58:10)

"I want you all to know that none of the content on this YouTube channel or my Twitter will be deleted none of it will be augmented and I wish you all nothing but success with it until I talk to you next"
(58:18 - 58:32)
Thank you, ICT, for 30 years of knowledge shared freely with the world.

Study & Review Flashcards

Click each card to reveal the answer (all answers are direct quotes from ICT)

What is ICT's definition of a Market Maker Model?

"this is one of the closest viewpoints to how I actually trade" and "it's algorithmic price delivery in institutional price swings" - ICT uses this framework 99% of the time when taking trades.

What is the critical prerequisite to understanding Market Maker Models?

"you have to understand all the PD arrays you have to be familiar with them because what you may or may not realize is a market maker model is relying on your understanding of every PD I've made available"

What is the difference between Buy Side Delivery and Buy Side Liquidity?

Buy Side Delivery: "the actual animated movement of price moving higher" - Liquidity: "a stagnant price level or levels where stops would be reside" - Delivery is directional movement, liquidity is pending orders.

What is ICT's definition of swing trading?

"if I'm bullish I'm trading from discount to premium riding the code tailes of buy side delivery if I'm bearish I'm trading from premium to Discount writing the coat Tales of sside delivery"

What is an Original Consolidation?

"that is where the market is accumulating" - identified by "a repetitive overlapping or reoccurrence of a level that's being constantly referred back to inside of consolidation"

How do you identify the high of an Original Consolidation?

"I seen these two candles here and then the body of this one and the body of this one so right away my eye jumps to that because it's what it's a smooth edge so I want to use that as the high of the original consolidation what's the low the lowest low"

What happens when price leaves the Original Consolidation?

"look at the body right there yeah we had a wick here we had a wick right there too but look at the body St inside that original consolidation see that that's characteristic to algorithmic price delivery"

What is a Balanced Price Range?

"where the market has both a downside and upside or sells side delivery and buy side delivery that overlap one another in the same relative range in price" - creates trapped traders.

What is a Unicorn setup?

"unicorn is second stage redistribution in a cell model Market maker cell model" - "everything's in your favor you got everything behind you it's just so it's so one-sided" - "the most energetic um swing high that it drops down from"

What makes Unicorn setups the best trades?

"they're going to always be the second stage redistribution in a market maker sell model" - results in "Ride the Lightning which is really quick sudden drops" - "the easist highe speed low resistance liquidity runs"

What is a Smart Money Reversal?

"essentially what you're doing is you're picking the tops in bearish markets" - ICT warns: "you are years away from ever being able to do that consistently" - requires understanding "what it is that we're trying to do here"

Why can you pick tops in bearish markets but not bullish markets?

"when we're bearish we can really get refined and trade the tops in bare markets because they're predictable they have a characteristic" vs "when you're in an extremely bullish Market how do you know I don't know every single time that they won't go in there and intervene one more time"

What is the Buy Side of the Curve?

"this hypothetical invisible line where the market trades up during buy side delivery trades into our Target where we anticipate the likelihood of a reversal if the market starts to reverse then we use the highest high that it forms to the left of that is what the buy side of the curve"

What is the Sell Side of the Curve?

"on the left side is what the sell side of the curve that means we're in sells side delivery what is sells side delivery going to be aiming for the original consolidation low why because it wants to repic under the original accumulation for sell side liquidity"

How do buy side arrays work in REVERSE on the sell side of curve?

"anything on the right side of the curve that was offered as support or as a discount array needs to start acting as what a premium array or resistance" - Bullish order blocks become resistance after the curve reversal.

What is First Stage Accumulation?

Either "return to original consolidation" which "that's usually a trade" or if you don't see the OC correctly: "the bullish order block here would be your first stage accumulation for you"

What is Second Stage Redistribution and why is it important?

"this is going to be the fastest elevator ride of the move going down" - "it's going to be the highest degree of speed magnitude and impulsiveness to go lower quicker" - "this is the one you want to be entered on because if usually if you miss this one you're probably going to be chasing price"

What does "Time and Price in Agreement" mean?

"time sets the stage then price does the act of precision" - Example: "London open" for return to OC, "New York open 7 o'clock" for reversal, "London close 10 o'clock to noon" for target arrival - "that's not random"

What is a Market Reversal Profile?

"we have consolidation we leave the consolidation come back in return to original consolidation when does that occur London open rallies up right in here we have an order block right there and then we have what it rips into the buy side trading up into New York open 7 o'clock in the morning"

How does Market Maker Model integrate with Silver Bullet?

"this right here trading up into that that is the 7 o'clock in the morning to 9 o'clock in the morning New York open Kill Zone Silver Bullet" - it's part of the larger Market Maker Sell Model framework.

How does Market Maker Model integrate with Model 2022?

"this right here is model 2022 buy side taken shift in Market structure fair value Gap go short that's M 2022" - Model 2022 is a component within the Market Maker Model.

What two primary reasons do markets go up?

"markets go up for two primary reasons one it goes up to engage buy stops which is buy side liquidity or it goes up to an inefficient"

What is ICT's view on support and resistance?

"I don't trade support resistance I attack support resistance I attack liquidity above old highs I attack liquidity below old lows and I use inefficiencies as targets or means of Entry to trade against those same ideas which would be anti- retail Theory"

Why did ICT stop teaching publicly?

"like all things all good things must come to an end and I am married to a woman that demands more of my personal time and social media and mentoring has taken a great deal of that"

What will happen to ICT's YouTube content?

"none of the content on this YouTube channel or my Twitter will be deleted none of it will be augmented and I wish you all nothing but success with it"