Defining High Time Frame PD Arrays

Definition

"This teaching is to teach you the hierarchy on the tools that I use for framing the trades. Now these same arrays are the same things that we've talked about since the beginning of the mentorship but we're going to prevent you from having them in a disorganized fashion. In other words, there's an hierarchy in how they are used and how you look for them in price."

Core Purpose

"What we're going to do is we're going to outline now the arrays and keep them in a specific order so that way you know wherever you're at in terms of market price what you would expect to see or what you're looking for. Okay, you know, what should I be looking for, an order block or should I be looking for a gap, you know what should I look for right now? That's what this teaching's going to do."

Premium & Discount Framework

Premium Market

"When we look at a chart, regardless of what time frame we're looking at, there's two elements that come to mind as a trader... we think of a price being valued too low or too cheap or expensive or too high. And the algorithm has similar thought processes built into it and we look at it in the form of a premium and a discount market."

Equilibrium

"In between these two reference points, the halfway point, this is always going to be referred to as equilibrium. Now equilibrium between where you think price will go because it's been there before and where it's at right now relative to an old high and old low, that's the current trading range."

"Between the red line and the blue line they are extremes. In the middle that's classified as equilibrium or balance. Buying imbalance is seen when price gets above equilibrium or up into that red level which would be resistance. Selling imbalance would be when price gets below equilibrium and down into the blue line or what would be just derived as discount."

Price Movement Logic

"The understanding is that price will move from a discount to a premium because the discount can't stay discount very long. Price is going to be established by whoever is selling it. Who stands to make a profit off of it? Well the central bank is going to be in the business of adjusting price."

"It's moving from a level of discount to a level of premium, from a level of premium to a level of discount."

Submit to Time & Price

Two Elements in Trading

"There's two elements in trading you have to submit to: time and price. When they both agree with one another and you have waited for that agreement to come to fruition, that's where profitability and opportunities are."

Time - The Unknown Factor

"Time is a murderer, it's a killer for traders unless you know that some of these ideas are gonna pan out for a long long time. You're gonna do a lot of things psychologically and emotionally that you wish you wouldn't have done because you haven't submitted to the time aspect of trading."

"We have no idea how long time is going to be required before the displacement takes place but eventually our expectation is we'll see lower prices down to a level of discount and that's what we're expecting or forecasting as a future price."

"You have no idea how long time is going to be required to get to your future price or forecasted price and you have to submit to that, a measure of time that is unknown. You can't know for certainty how many days or how many hours or how many months it will be before that price is actually arrived at or if at all."

Price - What You Study

"Price is what you're studying. You're submitting to time throughout the process but while you are in the trade or expecting this to unfold, studying it, you're submitting to the price. You know what? You're not trying to force your will in price. You're analyzing price to see what it is that's telling you in terms of institutional order flow."

Premium Arrays Hierarchy (Monthly, Weekly, Daily)

"For a monthly chart, okay, what you're going to do is you're going to look at the current trading range that it's in. So we're going to assume that you outline the marketplace in terms of old highs and all lows on the monthly and that's the easiest way of doing it."

Order of Importance (Highest to Lowest Premium)

Order of Encounter (From Equilibrium Moving Up)

"When you're at equilibrium or if you're moving up from discount, your expectations are to look for, very first thing you look for in the list as price is going up, the first thing you're looking to see to encounter is there any mitigation block that I got to consider because that's the first objective it could be a selling point. Then it's a bearish breaker that could set the tone for another leg lower."

How to Use This Hierarchy

"You're going to be looking up and the first thing you're going to encounter is the first thing on the bottom of this list and then you start working your way up that list. The farther you go up in this list the more deeper you go into a premium market."

"First when you look at is the mitigation block or bearish breaker and if there's neither of those you look for liquidity void to trade up into, to close in that range, or fair value gap to close in. It may not be any of that. Then you would expect to see the bearish order block to be traded to. Then that would be your selling opportunity because you're at a premium and you go to a logical area where institutional order flow would kick in, new orders would capitalize and then selling would ensue."

Trading Application

"These are going to be focused for primarily bearish premium array trading. In other words you're going to be using these areas at which to frame a trade or look for bullish targets at these levels."

Discount Arrays Hierarchy (Monthly, Weekly, Daily)

Order of Importance (Deepest to Shallowest Discount)

Order of Encounter (From Equilibrium Moving Down)

"If we were anticipating a move lower into price, into a discount or into a support level, we would expect the very next PD array to be a mitigation block. Now again that may not appear in price. If there is no mitigation block you would expect to see the next PD array in the form of a bullish breaker."

"As prices going lower, looking in the past to the left side of your chart, you'll be focusing on whether or not these arrays appear in price action. Their importance is again is listed from equilibrium. The expected order of how they're going to be in the price action in the form of a discount: the first one you would anticipate seeing is a mitigation block bullishly, then a bullish breaker, then a liquidity void."

Bullish Breaker Definition

"A bullish breaker is an up candle between two swing lows and the most recent swing low would be lower. Normally you're seeing a stop run in the past and the high, the swing high it forms between the two lows, that up candle is going to be your bullish breaker. So when price comes down to that bullish up candle it'll find some support."

Trading Application

"These are your bullish discount arrays and you would be looking for these for bearish targets or looking to get long at any one of these based on the current conditions in the market."

Breaker Precedence Rule

Breaker Blocks Higher Arrays

"The breaker has precedence over everything. Both bullish breaker and bearish breakers."

"If there is a breaker, anticipate price not going below the breaker and leaving the void intact."

"If there's a breaker below a liquidity void, the liquidity void may stay open. Basically that range may stay open."

Bearish Breaker Impact

"Bearish breaker will keep your ability to get to a bearish order block which will be resting higher up in the premium. When an old high is taken out, that down candle right before the second high is made taking an old high or turtle soup, in other words that down candle if it's retreated to, that's going to be a bearish breaker. That's going to keep you from seeing most likely, high probability, that it won't allow you to get to a bearish order block."

"So whenever you see bearish breakers just don't expect the bearish order block to be hit. Okay? Because it's going to most likely keep price lower because that's going to be the most dominant array of all these in here."

Breaker and Void Relationship

"There is a liquidity void that would be viewed if there's no breaker. You can close in that range and that may take you often to a fair value gap or a bearish order block. But breakers by themselves, even though they're low end on this list, it's the first thing you're going to encounter because if you're at equilibrium and price has already been moving away from the resistance level, you're looking up now for any potential areas to resell at."

Timeframe Application

Same Hierarchy Across All Higher Timeframes

"The same thing is seen also for the weekly chart. The weekly chart you're going to be looking at the same thing from equilibrium up. The first thing you would expect to see when you're expecting higher prices: are we going to run into a mitigation block, bearish breaker? If there's a bearish breaker you're probably not going to go higher than that. But if there is no breaker you look for a void to close in or fair value gap."

"The same hierarchy exists if we're at equilibrium and that's the current market action price and we're expecting lower prices. The first thing we want to look for in the left side of our chart is there any mitigation blocks or a bullish breaker. If there is anything less than that breaker probably won't be considered or retreated to. The breaker has precedence over everything, both bullish breaker and bearish breakers."

Monthly Chart Application

"For a monthly chart, okay, what you're going to do is you're going to look at the current trading range that it's in. So we're going to assume that you outline the marketplace in terms of old highs and all lows on the monthly and that's the easiest way of doing it."

Weekly Chart Application

Daily Chart Application

"Obviously the same thing is said for a daily chart. Nothing's changed. The same hierarchy exists if we're at equilibrium."

Lower Timeframe Context

"When we're looking at these higher time frame charts just understand that there's going to be levels that exist inside of larger price swings that you may not see unless you go down to the lower time frame. Now when I say lower time frame I'm only referring to the daily because the higher time frame analysis is all we're focusing on here, nothing below a daily chart."

"If this was a monthly chart, at that low there may be a daily short-term high that would create a support level that can't be seen on a monthly chart. So when we're looking at these higher time frame charts just understand that there's going to be levels that exist inside of larger price swings that you may not see unless you go down to the lower time frame."

Study & Review

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