Definition
"this is my bearish breaker"
"this is not a break and retest okay it's not an Fu candle it's not a like off it is a schematic in terms of understanding how runs on liquidity and then a repricing lower occurs"
"Theory Breakers are order blocks"
"this is one of the strongest PD arrays I have because the characteristic behind this PD array is that it is acting on pending orders"
Pattern Recognition
"low high lower low so this is a breaker" (Bearish breaker)
"this low which is a bullish breaker" (Pattern: High-Low-Higher High)
Structure & Pattern
Bearish Breaker Pattern
Bullish Breaker Pattern
"if you've ever traded and had your stop run hit and then see it run in your favor after your stop loss was hit that's what this pattern capitalizes on"
A-to-B Price Leg
"this A to B leg we're ignoring all this this is market for traction okay this is the manipulation"
"so with this out of the equation okay think of this as time distortion"
"it's running from the low to the high to get that liquidity but once it does that ignore it for a second"
"we're using the price Lake from A to B"
What Is Time Distortion
"all this is time Distortion this drop down is both manipulation and time Distortion you are getting knocked out if you're long and using this as a stop loss the mark comes back down reprices that level does the Dirty Work of knocking those traders that have a sell stop"
"and then inside of this price Lake from A to B that right there is what you're looking for for targeting"
"this A to B price lag you take that leg from the high down to the low and you lay your Fibonacci on that and then you you do your standard deviations lower"
Two-Stage Liquidity Model
"there's two stages of liquidity for the highest form of precision with my breaker you'll always have the short-term by side liquidity of all the short-term High but it's going to want to reach into a higher time frame by solid liquidity"
For Bearish Breaker
"short-term by side liquidity of all the short-term High"
"higher time frame by solid liquidity and then you're waiting to see if it runs away from that"
For Bullish Breaker
"you have to understand where there's liquidity and the best Breakers are going to see two levels of sell side obviously the short term that would be created with the short term though here in the rally up and then a lower drop into a much more significant or a higher time frame South Side liquidity so there's two pools of liquidity that's being engaged here"
"it's this one by by default that makes the breaker and then we're seeing it reach into another level"
"drawn liquidity and I love when it goes down real close to it and starts to Rally because I know what that's doing it's enticing folks to see that that's a time to go long and this we're on higher Engineers more liquidity below that well it makes this a much more juicier liquidity pool so it drops aggressively down in here"
Standard Deviations From A-to-B Leg
Targeting With Standard Deviations
"whatever this range is from here to here one standard deviation lower that is the easiest bread and butter approach to using the breaker"
"my eye goes right to that leg from A to B and I run standard deviations off of that and the easiest bread and butter setup would be is using the low to the high"
"whatever this low is to this High add it to this high up so that would be one standard deviation of this price range A to B that is the easiest easiest just bread and butter set up you can literally carve out an income a career just with that"
Advanced Standard Deviation Usage
"you can then use the standard deviations between point a and point B and see if they agree with a larger higher time frame pool of liquidity you may be utilizing for the ultimate bias"
"use all the breakers for any standard deviation idea or approach to look for targeting you want to see a Confluence of levels anywhere in that range"
Entry Methods
Conservative Entry Method
"if you want to be very conservative wait for it to provide some means to go back up here"
"you don't need it to come down into this level here and trade back up many times you'll see me annotate a breaker and I'm entering in this price Lake Running lower before it even breaks out that low because I'm not a breakout Trader I'm not a break and retest Trader"
"that is one way of using a breaker but when you understand where the Market's likely to go you can trade in this run before it happens so you're you're not becoming a break and retest type Trader"
Aggressive Entry Method
"if you're on side and you know you're looking for it and you're in a fair market you don't need it to come down into this level here and trade back up"
"I could be selling short throughout this entire range using the 2022 model and then use the breaker as an additional area where I can add in pyramid more or I can simply just wait for it to come back down"
"being long in here or somewhere in here with a fair value gap for institutional order flow entry drill or inversion for your value got something in this leg here there will be a fair bag up or two back above it find some support"
Last Up-Close Candle Entry
"is the last up close candle within the low high lower low"
"you zero in on the change in the state of delivery that last candle right there inside that last candle I can be a buyer anywhere in here I can use that order block"
"it's the last up close candle when we're in the lowest time frame so you want to strip it down into the range"
"for fine tuning your entry it's the last up close candle prior to the lower run"
Mean Threshold Within Breaker Range
"if we measure that range okay and there's gradients to that upper quarter fifty percent or mean threshold because it's an order block Theory Breakers are order blocks"
"midpoint or mean threshold is 44.84.50 now if the algorithm is going to allow price to be utilized there to go long but for smart money for people that see price like this what price does this Market need to price to to get 44.84.50 it needs to at least print 4484.25"
"inside of this consolidation it rallies above it and drops back down what's the low of that candle right there 44.84.25 that allows the spread to not"
Scaling Strategy
Standard Trading Model
"the model I've been showing you with trading ES I'll go in and trade six contracts first and then I'll add three and then I'll add one for a 10 lot position"
Breaker Scaling Model
"I'm scaling in this type of trade here I would go in with one add three in here and then six on a really good run into the breaker"
- First entry: "go in with one"
- Second entry: "add three in here"
- Third entry: "six on a really good run into the breaker"
"I'm building in the likelihood of even if I'm wrong and it goes against me on the six contracts I have three and one that help offset or mitigate most of the drawdown that would be occurring if it was to quickly reverse"
Precision Examples
4480.75 Example - Two Standard Deviations
"the low when this candle comes in exactly at 4480.75 standard deviation comes in at 4480.75 folks that's perfect"
"two standard deviations inside this inefficiency inside of the breaker get ready to drop your jaw"
"but that's precision"
44.96.50 Example - 6.5 Standard Deviations
"it's exactly at 44.96 and a half folks"
"now if I show you six and a half that's right at that old high you see that 44 93.75 that right there tells me that that will definitely reach for that liquidity"
"6.5 standard deviation comes in at the daily high of June 16th"
"44.96.50 which is based on that A to B"
Teaching Declaration
"that's not Wyckoff that's not supply and demand that's not any other thing out there this is mine okay this is mine"
"you're listening to the guy who codified it I am the person I'm the engineer I'm the guy that put this together"
"look at the date July 2nd 2023 everything changes with Breakers after today"
Practical Rules
Macro Timing Window
"the 11 50 to 12 10 macro it's a time of"
"all this is occurring by the way in the 1150 to 1210 macro okay it's a specific sweet period of time where the algorithm will start spooling reaching for liquidity"
Not Break-and-Retest
"this is not a break and retest okay"
"because I'm not a breakout Trader I'm not a break and retest Trader"
"I'm not a very common test Trader"
Integration With Other Concepts
"being long in here or somewhere in here with a fair value gap for institutional order flow entry drill or inversion for your value got something in this leg here there will be a fair bag up or two back above it"
"you can be doing inversion"
Stop Loss Management
"what happens if I go short here and it goes right up here or goes into my stop loss and stops me out you take a loss how's that for logic"
"then you consider does it still want to go lower if it does and nothing's changed you just got stopped out you just go in again with half the position size that you used on your first trade"
Key Requirements
- "you have to understand where there's liquidity"
- "these patterns form but you have to understand where there's liquidity"
- "if you're anticipating the market going lower if you're looking for a bear Market"
- "always have your charts shown on treating you within New York session there"
What You Don't Need
"using a breaker you don't need to have the break and retest"
"I told you how to buy and sell inside of the breaker before it even goes above its trigger point that I've already introduced initially when I taught Breakers"
Study & Review
Click each card to reveal the answer (from transcript quotes)