 till news event. 20 seconds till news event. 10, 9, 8, 7. Good morning traders. Welcome to the Traders Lab. I'm your host Tom B. Thanks for visiting today. I stream live Monday through Friday, 1130 to 1p Eastern Standard Time. This stream is for educational purposes only. It's about helping you build a business and a career in trading. This is not a trade calling room. This is about integrating book map order flow tools with auction market theory. In other words, how does the market work? Why does it tend to do some of the things it does? And how you might integrate a market understanding of these behaviors into your current or developing trade plan. The tool we use to see the inside the market behavior is called the volume profile. It is very simple. It is about price and volume. Most of us look at price and based what we do on price or lagging backwards looking indicators that track price in some derivative fashion. However, being to stay as close to the market behavior as possible and developing insight into these potential behaviors and market mechanics might help you get better aligned in as close to real time as possible. And to do that, we operate in a multiple time frames or fractals. And that is basically top down. That's higher time frame down and then using microstructure or fractals to participate and engage at times in the market using a vetted trade plan. Trade plan is really about understanding statistics and understanding that trading is a mathematical game. And it is about identifying an edge or a probabilistic outcome that gives you an edge over a random outcome. And this is manifested just like it is in Las Vegas where you have gamblers sitting on one side of the table. And they are random in how they behave in a sense. Do they fold? Do they hold? Do they draw cards? How does that impact everybody? Then we have the dealer on the other side which also has a random outcome. However, that random outcome has a statistical edge. And over a large sample size of interactions between gamblers and the house. The house has the edge which is why if you go to Las Vegas they give you the free buffet coupon, buy you cocktails, maybe have the limo pick you up at the airport. Please bring the cash because over time that edge shows up. So as traders, if we consider trading a business just like the house does in Las Vegas, it's not about one hand, one trade. They see gamblers as random inputs. They understand they have the edge and it will trickle to the bottom line. If a gambler walks out with a winning or a trader takes a stop, it becomes overhead. Cost of production. Not an approval whether you are smart or not or you can quote predict. That has nothing to do with the business. So trading in the purpose of this stream is to help you understand the reality of the trading business and how you might create a plan to operate in a random environment and change your viewpoint of what is really happening. We bring beliefs to the trading business and attempt to wrap trading around these beliefs. They work fine in the outside world but unless you've run a casino and understand the business of risk and risk management and probabilities, you've never been in this business. You don't understand it. The goal of this stream is to help you understand the trading business. I hope you find that useful. Let's take care of business. General disclosure. All book map limited materials, information and presentations are for educational purposes only and should not be considered specific investment advice or recommendations. Live trading is in simulation demo paper trading mode and strictly for educational purposes. Live trading executed in simulation cannot accurately represent realistic trading performance. Risk disclosure. Trading futures equities and digital currencies involve substantial risk of loss and it's not suitable for all investors. An investor could potentially lose all or more than the initial investment. Risk capital is money that could be lost without jeopardizing one's financial security or lifestyle. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading past performance. It's not necessarily indicative of future results and please remember this is not a trade calling room. Trade calling in my opinion does nothing to put you in a position to create a career in trading. It creates dependency and now that's fine if that's your objective and then you can of course do whatever fits your objectives. However the objective of this stream is to have a consistent application of a process. It is the consistency of how you operate in trading just like how the casino operates in the specific games. That consistency is what allows those metrics to come to the bottom line. So I do the same thing all the time. It is repetitive because the business of trading is a repetitive process. In my opinion and experience you must anchor your process. The market is not anchored. It is random. So one of these pieces needs to be anchored. If you can't control the market you can control your behavior and just like Vegas just like the casino they don't change the game. They know their edge. They know their statistics. They don't change the game. They let the game play and they depend on metrics. That is why in this stream I do the same process and that is how in my opinion you build the business. You don't keep changing your business. The market is the random piece. You need the consistent piece because randomness times randomness equals chaos. So your trade plan needs to be the consistent piece. Your execution needs to be the consistent piece. Your setups need to be the consistent piece and you measure them and as you measure you're going to find things you think work are really just random and are guaranteed losers. Other things that you may have right in front of you that don't fit your mental state of expectation might actually be the winning trades or setups. That's where you need to sort it out and that's the work of trading. So let's go take a look and as you guys know I started at the beginning and let's try to do this without creating damage. And again, I'm on a laptop and I'm in a I'm in Costa Rica on a shoe pan in the string. So please forgive me if I drop out. I will come back in hopefully at some point. Okay, this is our higher time frame and I and remember this is top down bottom up top down means higher timeframe. This is a consolidation and I reviewed this yesterday and if you guys remember yesterday in the stream I mentioned our target was to come down here. So we were and this is before yesterday's open which gave us this. So let's take a look at what happened. This is a consolidation so to low to high and remember auction if you will the market is an auction. What it is is the participants are trying to figure out what's too low what's too high and what they'll do is the price will go wherever it needs to go to attract the buyers. The price will then go wherever it needs to go where the buyers are going to say I'm not paying this and then the sellers lower the price to engage the buyers and then the buyers perceive if this is retail and that's what this is that this might be too low relative to retail and we tend to rotate around it. That's consolidation and you guys know that if you've been trading. So here if you guys remember this day here this price which is around let's just say 70 3969 half 3970 retail in here this the morning of this trade we this was the high of the day and we are on the short side. Okay and I want to take you back to it because this is the low of the previous day and what's sitting here sell stops and sell stops and I'm taking you back to where we were previously because it's really important understand and we are on the short side we said you know this is vulnerable and that's when I kind of give I call it the warning will Robinson moment and if you guys remember there was a TV show and maybe you don't but in the States called lost in space and there was a robot there that would say warning will Robinson and will was this young boy and the robot would kind of warn him if something is happening well this one and in the trader lab we talk about narrative in other words narrating the process and it goes something like this and by the way grab a pen and paper and I repeat these things because if you can integrate some of these behaviors into your trading it may help you stay in alignment because the market when the market is doing its thing it's reasonable to anticipate possible behavior right and then if it doesn't happen don't we want to be aware of it because something doesn't happen is actually more important than what is happening so if the stops are sitting here and the stops are sitting under here and the market is coming down and it doesn't do something that your warning will Robinson it goes like this so if this is too high then what then that then down here if we don't take it out so if this thing then that if not then what the then what is the warning will Robinson moment now right here at this level right around here and it was just a hair below that chairman Powell came out and said maybe we won't be raising interest rates as quickly as anticipated that is input that disrupts the auction and you remember we talk about the auction and then it's disrupted well we ended up with a long in here and then you know this is unknown you know this is I'd like to tell you we know but I'm gonna tell you the reality is nobody I mean that's the randomness of the market but this set up a set a situation that and we spoke about this the auction is a consolidation right it's two-sided what's something worth if the market races through an area it's not auctioned it's a bullet train it's like what's this worth what does it mean I don't know let's get out of here all these shorts in here cover and there's all these by stops now above here that becomes fuel and that's your breakout right and that's what breakouts are a breakout and especially as the time frame goes higher has more energy because all the participants in this consolidation one side is going to get pounded and it was these guys thanks for playing so that's why you get these outsides so now we come up here let me just show you this and then we consolidate up here this is balanced so two-sided trade right this becomes our retail price up in here so this is where the highest volume is at the time up in here what do we do open lower come back up check this to low retail but we can't hold on to it and one of the reasons is down here is not auctioned so yesterday we fail and we start coming down into this poorly auctioned area that indicates potentially too high now where was where did we leave behind this so that sets up this as an area to check and then where Jerome Powell actually made his announcement was around 56 so 3956 is everybody with me by the way if you have questions please post them there's about a 15 second delay in YouTube and make sure you're on 1080p and I will do my best to answer them and now I have to do is get rid of this chart and not blow things up so let's try that and now I'm going to start from the open and we'll go from there and you'll see how this develops hopefully just give me a moment now I'm on a laptop guys and I have to tell you being on a laptop does present certain challenges okay okay we doing alright with the discord and YouTube I'm just trying to keep things sorted out here not blowing things up just asking yeah hi Paul thank you alright and by the way if you're in YouTube a thumb up if you find something useful of this I'm going into this in detail because this is what I do remember this is not a trade calling room this is about helping you develop a trade plan so you could do this independently because in the end this and this about being an independent trader that's why trade calling in my opinion if you're if that's where you're going you that's that's also like just give somebody your dollars and let them trade give them a percentage of the profit that's what trading advisors do otherwise you're not learning in my opinion doesn't mean you can't get value out of it it just means where you're going with that so let's watch so our th open is a 30 central time my time this is the open now there's a couple things you want to be aware of let's let's talk sequentially yesterday turned into a trend configuration down that means we were falling out of that higher time frame and potentially going to fill in that poorly auctioned area that I just shared with you okay so that's one thing and when you fall out of an area in the market now expands its range and it becomes one sided that is a trend configuration and when in the trader lab we talk up something really primary to trading that's called context the context changes interday from directional to rotational and back to directional rotational and that is the fractal nature of the market so we have yesterday and then we have the ETH what is the ETH it's the next auction so yesterday we suggested that there would be downside potential continuation because the volume point of control yesterday which is the retail price of closed towards the low end I believe of the auction of yesterday's trade that suggests if the retail price and that's what's represented by high volume or the volume point of control which is this yellow line is moving lower that is suggesting acceptance potentially lower and it is all contextual so then so that suggests lower then we have the ETH with the tight range and the overnight volume point of control and I'm going to try to open this up just want to show you how you're putting pieces together potentially and again nobody knows this is the overnight volume point of control so for the ETH you have a high and a low and it's called the overnight high overnight low and the potential for one of them they get taken out is over 90% and you need to vet any statistics you hear from anybody for yourself but I'm just going to say over 90 also the first hour high and low which is called the initial balance high low and please write these down even if you've heard them before you should continually write them down and make them potentially part of your trade plan if you find some validity and some way to use that information also 90% probability first hour higher low will get taken out this is the overnight volume point of control and let's remember what is the volume point of control it's retail in other words highest volume in the way to think of this is kind of like when you go shopping and I don't know why I think of tuna but tuna at a dollar can if that's where you're willing to buy the tuna and the seller is of tuna manufacturer let's say seller is willing to sell you a tuna for a dollar that becomes the retail price so all the shoppers going to the store pay a dollar seller sells at a dollar and that's high volume that that is your retail price isn't it so in the overnight ETH session this is where the highest volume was so it's your retail price now in trading there's no precision it's I always think of it as horseshoes and hand grenades but as a reference point of what was the fair price in the most recent auction write that down so we now are back to the open you're going really right so the open is 830 central so now we're back I have to put these pieces together or else it's not going to make sense and even then it might not make sense but we want to understand how we can use participant behavior that is to me the clue or the key of understanding the potential and like everything in trading it's maybe right but if you can understand what the market participants are saying maybe that gives you something that you can build upon understanding and accepting it's all random on top of that so this is retail in the last auction this is the open this is the previous settlement so we open lower what might we get if you were short from yesterday and we always discuss this is in a trade lab there's some possibilities well first of all it opens over keeps going okay I mean it can do anything but what might it do let's let's reason this out write this down might and you always have to think from both sides so if the market short from yesterday we know we have a poorly auctioned area below we know we're rejecting that higher value of that that in the intermediate time frame and we're leaving it which is suggesting too high and we have the potential to go back where we left below around what was it 3670 or I can't remember exactly the number because I can't see all these things on my chart since I only have a laptop by trading off a laptop with two monitors by the way I do trade off it by the way but with the streams running in the chats I just cover everything up so this is retail in the overnight session so now now we're back to the open watch try to watch anyway so if everybody's short remember what's the potential profit taking what does that give you it's called write this down responsive buying now nobody knows this is going to happen so don't think there's clairvoyance what there is is maybe write that down maybe we'll get the buyers who are short covering they are and that's why they're called responsive buyers they're not getting long necessarily I mean some might be but what would you do if you came in short and you had a open that was lower would you might you cover you might cover some if you're swing trader right that's what this is so now this up here was the retail price let's put it together now we're going to put pieces together and I'm going to move along I want you to see market mechanics and context these are fractals they are built upon each other higher time frame in the most recent options and then the developing time frame so market opens dips lower comes up check price check in the ETH aisle is this fair or too high if the trend is down this now let me tell you what this would be and I have no long because I'm looking for short context but if you were a shorter term trader this might be a long back to here not me not my thing me short so I'm looking for shorts this is my first area to look for behavior and again I have no clue now I'm looking watch I'm looking now this looks like a potential short here we check above the overnight and then we reject it okay now what watch this here now this may if this is not part of your trade plan you got nothing to do you just sit near a tourist we do a lot of touring in the trader lab you know it's like sight seeing at Disney World high volume break now these are not trade recommendations is this not even a trade that might be part of your trade plan let's watch it by the way you guys getting a clicking noise coming through I just need to know if you're getting noise let me know if you're getting noise right now no clicking okay good all right good no noise just me okay it's from this up here so potential short not even something I would take here's what I do I'm looking to see if I want to get short I'm not necessarily going to get involved here I'm going to use it as an indication that this price might be too high it gives me more confidence now to look for the shorts I'm certainly not going to be on a long for me I'm going to be looking for shorts the volume point of control shifts higher notice how we came back and check this under different context this would be a long but I already got this so let me just take you back if we hadn't checked this and the context with different this is a setup for a long to here but we already went there and the context is short so you see no trade now this and I wrote this down for you guys I want to share this with you this is something I don't talk about but it's time to talk okay we call this a variable high volume node and let me explain what it is market opens chop chop chop here's your first volume this is a consolidation to high to low right break low to low break high that says this is too low at the moment volume point of control is here this is where the most volume is we come up here overnight volume point of control break too high pull back and check the volume too high return here okay back here too high all this is suggesting me too high except this moves up now watch this is too low this is too high this is too high this is auction now if you can't interpret this don't worry about it when you it's not clear your job is not to get involved your job is to attempt to narrate it and wait for a vetted setup that you can recognize and it's a building process now I'm going to show you a short right here if this is too low this is too high I have to turn this thing off it's it's just showing a lot of selling going on here and we break down we break below what was too low we come back and check it it is a potential short now you're gonna ask me why too low too high overnight volume point of control which is the same as this develop this is developing it's too high come back here are we gonna go up no we're not doing it we break the other way if now this this becomes your potential resistance it can come back here it can come back to the view up it can come back to the mid but the volume supersedes the lines on the chart for me especially because of what happened above now it's a short and wherever now here and this is about trade management look at this liquidity sitting in the book watch now this is a different part of the plan how do you manage the trade well you could be out here or you could just be staying in a higher time frame let me show you the next trade and then we'll get into real time wherever that might be this is resting this comes into the book this comes into the book this is like pressure okay and it skews the book now I don't make a trading decision of this what I do is I'm using the structure of the participant behavior as a primary chassis but when I see this it helps me look at it in the sense of well we may rotate off here then it's a matter of your trade plan right what do you do about this that's another piece and this is something that's a function of the fractals so let's watch what happens here so that trade would be done if that's part of your plan now let's watch we come up high-volume is here now I'm looking again for another short right here this is called the pock migration notice the book notice this chop chop now right here it is saying that where the yellow line was the V pock above was is too high so now what does that say too high this now becomes retail if it's retail then we have the potential to come down and check this liquidity and potentially go lower watch this is trader lab behavior this is you know what we do in the trader lab this gets marked becomes a variable high-volume node right is everybody tracking just let me know you're with me I'm showing you a sequence because these are observations or setups that we vet and trade and everybody's different as far as the time frame right yeah good morning everybody so let's watch oh another short watch the pock migration now this is a target if you guys remember 3970 from the higher time frame chart this is a target area now when I get here you know I'm looking at and I'm going um okay but this just came down saying retail area to observe now we have something else right remember I mentioned the IB the first hour high or low has over 90 probability and I know you guys wrote that down well this is a primary target but I have a statistic with over 90 probability so now I want to hold and I have another price point below this this is where Powell came in and made his announcement with scrambled the auction we had the bullet train remember well this is where it was so if the auction was disrupted the potential exists for it to come back and check after you know who and continue where it was before or whatever over 90 probability this is my next target so now hanging out let's look now short from here I have no problem with that what about you now we're going to get into real time remember first hour low and it sets at 930 which is right here and there's 930 okay now this thing is going down right so I don't think we'd have to worry about the initial balance high getting taken out we're below the higher time frame volume point of control this is the inner day developing volume point of control this is all fractal you see this is the thing the beauty of auction market theory what happens in here where this little microstructure is right in here is the same as what's happening here is the same of what's happening there and the same as what is ultimately happening here so let's watch so chop chop rotation and this is called mean reversion now this is probably going to make you a little nutty but we have context inside a context so this if this is retail there's a couple possibilities we just break down come up continue okay possible so if you got involved here you know you get a scale if you're following what we do in the trader lab let me show it to you right here short into liquidity or or if you didn't get a scale you would take a stop me I don't throw myself under the bus for that but this is the next trade this is called mean reversion and it's a very tight trade here if it doesn't fit your plan you have nothing to do watch now mean reversion so here's what we have down context I think we agree we're looking if it goes into balance this is called balance and all it is it's changed from a directional move in the shorter time frame to a rotational move and that means try to get to an outside edge for return to the mean that's what makes it mean and we laugh in the trader lab yeah it's mean because you don't know where the outside edge is so you can get you know you can take some take some shots take some hits and it's all part of trade management risk management costs of production remember the casino right and then remember we have a statistic at 9 30 over a 90 probability right you have to vet the statistic for yourself so why wouldn't I make sense that I would be trying to get an outside edge to scale for this and then hold right and I have that 56 down below remember this is how you put pieces together so this would be the target area so watch this is all what we talk about in the trader lab and it's all out here before the fact so high volume break pull back potential short and you're going for the IB comes in at 9 30 so this low and then here so let's watch it what does it do don't remember oh there you know okay there's your target that trade would be done is everybody see it does it make sense why the we talk about context if the context is down but in the fractals it can change behavior and go into what's called mean reversion this is the same process we use in the trader lab uh when it's just two-sided trade you know up down up down well if in a downtrend configuration it's one side of that context which is the outside end is this logical does it make sense are you guys tracking so watch v pock migration saying too high we mark this it becomes a v h v n right variable high volume note i am consistent if it's methodical and random remember the whole thing is maybe so this was too high this is a reference point if we come back to it currently this is retail so chop chop chop break low let's just see what it does i don't know what it's doing you guys tracking have you seen this before yes no maybe is this makes sense this is basically if this then that if not then what if this is too high and we shift low and you see chop chop consolidation break low this is micro structure and compounded with intraday developing structure so this is the same behavior is all this except this is the daily time frame developing daily time frame that's your volume point of control the highest volume at the moment in the whole enchilada this was where the highest volume was but when the volume and the price are moving together it is suggesting this is too high now the market can do anything remember come back and check this and go yeah maybe down here's too low let's go back and check what's too high and it can ping pong or none of the above but let's watch the behavior so what's the behavior look chop chop chop micro structure let me open it up and show it to you so right here and all i'm looking at is the volume now that's on the chart this is the chart volume profile this is how i use it book map is really cool for this because now i'm looking at the micro structure here this profile is tracking all the volume for the day and the volume point of control is generated from this so that's this and previously was this in here is that same process fractal so when i see this chop chop chop chop it's a consolidation buyer and seller buyer and seller tuna fish at a dollar in the convenience store down the street it's limited but the same process happens you know 10 o'clock Saturday night pint of ice cream there's no line at the little neighborhood store in fact they charge a little too much but for the convenience i pay but because there's less participants it takes up there's less volatility but it's an auction and there's a retail price so that's what that is and then this is for the whole day so far so too high too high rake and i'm looking for a pullback too high too high see the alignment with the multiple time frames short are you guys tracking watch now now you know this might might not be your thing price check in aisle three right here you see it price check do you see something over and over and over and over and i don't mean to say over and over but i'm trying to make a subtle point so too high break too high break shift down is that really too high break you see microstructure whatever but we could come back and check remember is that really too high yeah i'm not paying and i'm out of here tracking now we're in real time uh marcellulose welcome to the trader lab review this stream i already went over that at the beginning of this and i don't want to repeat i want now to stay in real time i got to get this thing on i got it this is making me nuts hold on a second wow this is a new uh tool that i'm not i don't think it's released yet it's called market pulse and it basically uh it's right now it's tracking the differential in the volume between the buyers and the sellers i don't think it's available yet but you know we a lot of these things we vet and by vet i mean i should say you know we work on with the it's beta so i don't think it's out there anyway let's get back to real time so let's observe the behavior too high too high price check price check and we also have a setup in the trader lab let me explain it to you it's called the ib continuation trade remember the ib stat is set at 930 90 probability break it we break it we come back inside pick stops right here this shifts down confluence and that's after a stop pick short pull back stop pick short pull back stop pick here shorts these are all shorts in the trader lab pullback short continuation helmet trade management everybody tracking and anybody in the trader lab not familiar with all of this any questions are you guys doing in youtube you pass out yet any questions on this this is a trading process you know and it's repetitive because to me it's not about us changing what we do it's about us having a plan and waiting for our trade and in the trader lab it's not about that grabbing all the wiggles you know in the rotations which is a phomo is really i wanted i wanted it how do i get it how do i get it and i think when we start trading that's kind of where our orientation is because we think that's what trading is in my opinion that's not trading trading is waiting for vetted setups just like the casino plays its game it doesn't change its game it you know it it's not they just have their expectancy and they trade their expectancy stops a part of the cost of production in the business but these are setups right and if you come to trader lab and i invite you if you haven't come to trader lab to visit you know if you're interested in the business of trading not trade calling you know i'm allergic to trade calling because it creates dependency and not independence i'm sitting in Costa Rica at the moment with a laptop and a second screen i am quote working from here i am trading from here it creates independence getting to this point took i will suggest a little time i started trading in 1980 and i will tell you that i've gone down so many rabbit holes that i don't remember them and i think that's good because i'd probably be continually depressed about it because i had beliefs and the randomness caused me to think something actually was working and then i would create constructs to try to keep it working you know multiple timeframes backwards looking indicators you know well we all we all kind of go through that but what i found was i did not have a consistent process because i was mixing inputs and that created randomness on my part you know so i was random the markets random what do you get out of that to me chaos so i really had to gradually and it was a gradual process because early on when i started we didn't have indicators and then indicators you know you guys know about me i worked shared an office with george lane he created stochastics i actually worked early on with the primer chassis that trade station was built on i actually collaborated early on with ralph and bill cruise out of miami who actually created trade station but before they created state trade station they had an end-of-day process so i started writing code so system design i was a swing trader i'm just saying as a trend follower and of course i didn't sleep well i had a quote machine next to the bed i'm just going to say was not very popular with the significant other but you know anyway so um things have changed right we didn't have a globe x we didn't have anything we had nada so uh that's my background you know so i've gone through a lot of and i've gone through the same thing you guys have it's not i'm no different i just it took me longer because we had no access to information you know there was no internet though you bought a book or went to a seminar so i'm just sharing a little background about me if you don't know um and um very painful and very and here's the other part having segments of time where everything was rocking and rolling but i didn't realize that it was my inputs were random and i didn't understand the business of trading nobody ever told me everybody was a floor trader and what i did was they and that technical analysis you know kind of what i was doing at the time uh classical bar charting all that was looked down upon as budu i mean it was really looked down upon it was like a joke now you guys might not think it was a joke but it was a joke back all right am i back what happened here am i back here guys things kind of went south of the border yeah okay lovely see that the pigeon landed on the on the cable must have been yeah okay good thanks yeah all right let me see if i can restart a few things we had a little uh nasty going on here let's uh see if i can get things going hold on guys just trying to repair uh some minor events here okay and we all back sort of okay are we streaming okay and youtube we're all right okay good all right sorry about that guy uh you know Costa Rica far too actually i'm glad that we have any internet that tell you the truth it's not the internet it's the power let's see if i can get things working again over here okay so back we are this is the next target down here this is a low volume area uh this is still a short that we were talking about i and you guys i was talking a little bit about myself and my experience and going down the dead ends uh in the rabbit holes of inconsistency where things appeared to be useful but it was always a curve fit and i i don't know if you heard about my mention about omega research Ralph and Bill Cruz that i uh had the early the chassis that trade station was built on i actually work with that so i've been around a while you know 43 years of trading and and i'm not going to you know and here's the other part of this uh there's not one way to trade but i would suggest you strip it down to its minimum components so you can create consistency uh trading does not complexity obscures what's right in front of you and my belief was that if it was more complex i would kind of find the needle in the haystack in my words i came in with a belief that if i had more i could get more certainty but it did the opposite if you're doing that and you're have and you're kind of waking up and trading groundhog day uh you it would be the same thing for you if you're finding that's your your uh you know what happens to you uh you might not you might want to you know consider reevaluating you know what's happening you know because that's what i found uh but i didn't understand so i would try different derivatives of the same process but end up at the same result so if you're changing indicators tweaking them layering indicators over indicators of multiple time frames you are in a curve fit process uh because the market is random so you're always chasing a random environment and trying to wrap really fixed structure the auction kind of comes at it from a different place that operates in real time based on participant behavior and that's kind of why i do what i do um and it's only after you know and again it's only what works for me i'm not saying but i think if you come to the trader lab if you haven't visited the trader lab you're going to see uh consistency uh you're going to see traders with all different ranges of experience from newer traders to traders with over 50 years experience that are using a process like this i will also say that uh career traders i know use use these types of processes and approach the business as a statistical or math based data driven business not a cowboy experience you know not a video game business um if you're interested in the business of trading then i invite you to come to trader lab and you go to bookmap.com join the bookmap discord chat uh go to trader lab there's 60 pdfs of these behaviors that you can download and you know look at them think about them also there's a primer webinar i did about a year ago on auction market theory volume profile the integration of these tools how to think in market behavior versus indicator behavior um and also uh mental states and retail trader behavior you know things of this stuff you know all the pieces that we've experienced i mean as a retail trader and no longer being a money manager um i you know when i was trading early on i started to have the same experiences you know early on sell the mid you know put your stop above the mid well if i was doing it everybody else is doing it right did you do it do you do it well if that's the case can i use that understanding of typical retail trader behavior as an advantage versus behaving like they do write that down think like a retail trader don't act like one unless you want to uh for me uh if i understand where stops will pile up do i want to step in front of those stops or might i want to use that information as an asset right up to you me i started developing trading systems that would actually trade into the stops early on so i understood you know after getting my stop taken out and here's the other part of that i the view you guys always sell the mid or always buy the mid early on i thought that's what we were supposed to do and i'm saying real early on because that's how i learned in classical bar chart you know you learn these things you know head and shoulders the flags the pen and saw this so um i learned that and i did it and i had my you know my hand my charts that i did by hand and i get my ruler and my pencil and i draw the trend line and then if it kind of went outside the trend line i'd move it a little bit now it fits well that's just all derivations of curve fitting but i again i didn't understand that so over time you know i kept getting the same result and i didn't like the result and then i started thinking well if i'm getting this result there's others maybe i don't do what they do maybe i build the system that trades into what they algos operate the same way they know where the stops are they know retail trader behavior you can build algos if you choose to that just take advantage of retail trader behavior uh why shouldn't we think the same way but not act the same way just a thought so this is about the business of trading okay um if you're interested go to bookmap.com join the bookmap discord chat you don't have to be a bookmap subscriber you won't be solicited there's a lot of education available in the trader lab there's those 60 pdfs you can download and the videos you know that you can watch give you some idea what this is about and again you know these aren't trade recommendations it's about understanding the market mechanics how it tends to work and then it's up to you to start building the pieces it's really a building process and in the trader lab you know what i attempt to do is provide some guidance as far as how to potentially do this um trading the thing is if you can keep the trading part of it simple and then just wait for your vetted setup which is a process of having a plan when it shows up your job is to take the trade the confidence to take a trade is number one accept the outcome is random number two know it has a statistical at if you know let's say there's x let's just i'm going to make up a number uh a 70 percent or 65 percent probability that you'll get risk neutral and that requires trading a minimum of a two lot if you can get risk neutral and you know statistically you have better than a 50 50 chance of getting risk neutral versus taking a full stop does that help you engage when that structure or setup shows up if you don't know that you're going to be at a higher level of fear and don't deny it it's part of our chemical response to be fearful i mean the uncertainty provokes the fear so if you have a vetted trade plan with statistics you would open your binder if you operate that way to the setup you are waiting for you will see that when a certain behavior happens that you might anticipate that setup showing up and then what is the statistic if you get a trigger of getting risk neutral it requires a two lot minimum configuration the first contract is to buy the stop on the second one so you don't have to mess with it and psychologically your stomach will stay intact when you're riding the rotations because it doesn't usually go in one direction it goes down and rotates up if you were short from here and you got risk neutral what would you be doing if you got short and it does this where what would you do would you be trailing your stop here here where what would you be doing would you be if you got in here and it does this would you bail out because you only have a one lot on or you're trading it as a one lot what would you do how about if you had where risk neutral you don't have to move your stop you can leave it far behind the noise you see right here let's just watch this behavior right in here we'll just watch it it's not a trade it's in the middle of nowhere but let's watch the behavior now here's the thing with these structures this is a potential triggering structure it's not a trade it's behavior there's your micro high volume let's see what the behavior might be this is nowhere understand that let's watch this is about the fractal this is not a short it's not a trade recommendation i just want to show you some potential behavior now if it breaks above here there's more stops right remember this here is poorly auctioned the market has a tendency to come back into poorly auctioned areas and auction them so this right here created low volume this breakaway just like the higher time frame i showed you was not auctioned so the market has the potential remember the higher time frame and if you don't remember it or you missed the beginning of the stream if you're in the bookmap discord chat you can come back and look at it because you need to take a top-down bottom up approach right fractal so we're trading inside a higher time frame in the higher time frame we had an area that was not traded and i'm assuming this is low volume because i lost my data now that i'm looking at it so this is a micro high volume structure chop chop chop convenience store ten o'clock saturday night break low pull back the high volume potential short but not unless it's part of your trade plan and then potential rotation down all this suggests me is rotation that's all it's suggesting and where is the obstacle this high volume down here which is from this well let's just see what it might do oh no high volume a high volume potentially if we squeeze above here then more shorts get taken out and then the other swings go that's kind of how this might work so we're just observing guys are you guys tracking again this is not a trade recommendation never is never will be this is about structure and auction market theory and how you might read fractals this is a triggering structure now if it shows up in the middle of nowhere it's not actionable it you can educate yourself to develop unconscious competence to recognize the potential and again like anything and you know it could do whatever it does let's watch it okay and in the meantime i'm going to check the chat and let's see if there's uh any questions limit buys would be support uh no tyler uh buys not necessarily uh a limit buy is a passive order it might be it might become supportive but they're not the aggressor they're passive um and a lot of what's in the limit order book is not real you know it's algorithmic they they can stuff this book and it doesn't mean anything right so what matters to me is volume i'm just telling me i'm not saying anybody but the limit order book for me is a piece it's algorithmic in many ways the volume this is what means something to me because i'm tracking the participant behavior which is what creates the movement this is algorithmic you see how this is flashing on both sides they have known see this they're together this is the same guy that's algorithmic and it's like a hand you know this if this comes up it puts the pressure on the book that means these uh the sellers above the limit sells will pull so it actually influences the book but on the process and again it's a prioritization of inputs and i'm not saying it's right i mean i don't know you know i don't know what's right i do know that for me and i'm i can talk about me that's what the stream is about and i'm not saying what i do is right i really have no idea uh is the chassis how do you prioritize inputs i prioritize this over anything else i want to see confluence when i see it of other behaviors it gives me more confidence and uh and i do talk about order flow but if i have nothing visible here it doesn't mean i don't take the trade because my chassis is built on the participant behavior that's the auction then it's the integration of bookmap order flow tools how it helps me you know i see this sitting here but you know so does everybody else is this real it hasn't traded you don't know what's going to happen here are they going to really trade are we going to see front running probably in front of it if we come down are are they going to pull you don't know their intent that's the whole thing with this so for me and it's just one way to do this that's and if you guys figure out a better way which i hope you do come to the trader lab this is what the trader lab is all about it's not one dimension uh we all share and leverage our collective experiences and that's all i'm doing in the trader lab i'm just one one guy you know i'm not a vendor i don't sell anything there's not none of that not my interest not my time uh but i do having you know gone down this path and seeing so many retail traders not have a chance uh because they go down you know they go on now you go on the internet you have so much input and so much information how do you sort it out so that's why the trader lab exists just to help you get a handle on something and then attempt to make it your own notice where we went is this a coincidence i'm asking you guys is this a coincidence and yes and no it's random but what else is it behavioral now we come back above here squeeze a theory right that's all i know are you guys following use the last price um well well the last price i'm looking for the reaction you know this see this was where this price was too high there are stops sitting here this auction might be complete it might have gone down and found its buyers you know uh and then it can come back and check if we take it out remember what's sitting here fuel so we can squeeze i don't know when i have something like this i prefer you know first time is the charm which is this in other words this is a triggering structure chop chop chop break it needs to break there's your trigger this is the micro high volume test you see the sellers all this is a short once this is done and we come back all of this buy stops above here now our potential fuel which is so for me now remember i was saying all along this is not you know anything but you can study these and part of the thing with it's this structure in alignment with a higher time frame structure you see which might be up here subject to your trade plan if you can trade in this fractal yeah you could be trading this do you want to operate in a 4.5 point range as you guys know me i like the kickback i'm more like give me this this takes a lot of effort here's the other part of this it's not that you can't trade this but if you can't trade this then you have no business working on this this is an advanced process and here's why you have to be precise because the once the range compresses my risk to enter here and trade this is the same risk is trading that whole more range which one do you think makes more sense i'm just asking can i trade this yes do you want to trade it i'm going to suggest no not until you have this and you are profitable all this is like adding a turbocharger on and if your fomo says i want it now you're on your way out not in you're on your way out of the business this is something you can look forward to but it's a whole different game it's very advanced because look at the speed you have to read uh so if you're going to take the same risk on a trade like this and you're playing in this i want to take that risk here i got the same risk for this what pays the bills same risk for this risking a stop and a stop pick right above here see it it's very nuanced this is and very fast so you develop the competence in the higher time frame fractals and then as you go down your risk doesn't really change what happens is the compression and the time changes in other words much more fast much quicker much less room for slop does that make sense but you can see a generic process right is this making sense is number two uh is number two is that one not working guys uh tb2 no no no screen uh whatever on there oh it's down you know let's see if i can fix that hard to say um i'm gonna try this guys all right sorry guys you know i'm having some technical issues i'm sitting in costa rica and they're not known for uh being animals we're gonna come at least out here where i'm in a little place uh on the beach really in a small town uh on the coast on the pacific coast and uh infrastructures not something that they're okay good we're back up now let me make sure youtube is still floating along we doing all right guys youtube all right you know the thing about what i do is there's no i don't really think of these as indicators um yeah uh karma fx thanks uh for being here uh yeah if you're interested in the resources uh book map has to offer if you're interested in the trader lab you go to bookmap.com join the book map discord chat uh come on over to trader lab take advantage of all the resources um 60 pdf's of these behaviors you can download and look at you know ponder them think about what you see think about why they're very detailed uh and uh early on uh you know book map asked me to create material you know just post it from time to time because i used to just do this in the uh chat try typing this out you know but i i did uh tried to and it was uh you know trading and doing that is a bit of a problem you know so i was really rough so they said well you know what do you think you know i said okay i'll try a little streaming you know it's not my thing you know i'm not a vendor uh so anyway um but this is very sensible uh the auction is the basis of how the market operates it doesn't operate based on indicators uh the auction is really what the market is all about is trying to figure out what's this thing worth i mean really um that's all this is if we knew what the price what the smp was worth we'd have one price it'd be fixed and we'd all go home but the market doesn't know what this thing is worth so what it does is the participants try to figure it out by auctioning what's too high what's too low and they do it in all time frames you see what's too high what's too low you know is this too high is this too low you know what's fair what's unfair i don't know they don't know is this too high where's too low say low of the day might be too low don't know this is another target down here in a higher time frame doesn't have to get there never we don't know yeah well thanks karma you know it all takes time guys if you want to build a business let's get real you got to be committed you got to invest time you want to be an athlete you want to compete at the highest level because that's what you're attempting to do you're competing against the best minds on the planet you know we're talking phd's in math quants hedge funds prop firms i know firms that have physicists on staff that are continually trying to figure out how to get your dollars do you want to compete well think about it get real it's a this is a you're going to build a career you want to be a surgeon what do you go through to be a surgeon you want to be a professional athlete what do you think you go through you get coached you watch films you go out on the court and you practice practice practice you review your performance you look at what you might do better you review you review you drill you drill you drill trading is no different the other thing about trading is it's metric driven you can you can drill down into it and start deriving metrics which will help you manage your emotional state don't underestimate the challenge in trading the trading part of it you know we have to manage our fear it doesn't go away early on when i you know had FOMO and i would click the mouse and do all kinds of ridiculous things move my stop to break even when there was no reason to it was all driven by emotional states i didn't understand them because nobody had talked about it just wasn't out yet uh early on because nobody was doing what i was doing i'm telling you i i was it was like being under a rock all my friends were floor traders you know we'd all go to breakfast you know usually after the first hour of trade everybody went to Manny's on Jackson in Chicago that was the place to go for breakfast if you had to wait online they give you a little box of milk dots which i thought was pretty cute and then they had a great omelet there so we'd all go and we'd all talk and uh you know they thought this was crazy because don't forget they were in a different business and now the floor traders are gone but now we have the algos and we have market makers of course so everything has changed right i'm still doing this those guys most of them could not transition because they needed the noise and the sound and the pit they need and notice it was different you know so it was a different business that businesses are uh now we're the business has evolved and changed because of computers but the processes of price discovery and value have not changed Peter Staudelmeier uh came out or shared the market profile and i learned it from him and i think it was 1985 you know and i had already gotten involved in indicators so uh and it really messed me up because i thought uh i would use my indicators and add the market profile all i did was add conflict so i couldn't do anything i mean it just made a mess you know um the stop indicator i'm getting a question how the uh stop indicators well tyler the odds are not against us uh the odds are against retail traders um you can the thing about odds probabilities you know you're mentioning the term odds actually if you vet a trade plan the odds can be on your side if you don't have a trade plan in the statistics then you're the gambler and the odds are not then you you are playing against the odds it's a very which is a very insightful statement you just have to extrapolate what that means the odds are against you yes unless you know the odds then you make the odds on your side and odds is a it's a another term for expectancy probability so yeah the odds are against you if you don't know the odds and chances are if you don't have a vet a trade plan the odds are against you and that's gambling and over statistically speaking that's not a winning business model it's a losing business model so yes yes and no yes the odds are against you if you don't have a vet a trade plan if you have one then the odds are with you and of course your outcome is going to vary on you doing the work you i mean everybody collectively and also being able to execute biggest problem in this thing is actually doing it because of fear having the statistics help you manage the fear because now you can transfer fear from the randomness of the outcome to overhead and cost of production because you know over a sample size or distribution that you have a net assuming you can execute the darn thing and follow your rules that's the job of trading it's nothing more than that and then it's a wonderful business it's a random business but days like today are the days that make up for the days where it's just you know nasty and there's days it's nasty and that's just part of business of trading every business has interactions or you know let's say you're manufacturing a widget some people don't pay you for the widget sometimes the machine breaks down sometimes you have an expense you didn't expect right that's that's business so i'm suggesting you change how you think about it and the only way to get to that in my opinion is to understand the business of trading and that's how potentially you can create a career and have longevity in this business so it's not a hobby you can't say I was a trader and that might be that might be the outcome for many of you because you got to do the work and be willing to invest the time to become a top performer that's why this is not a trade calling room it's a waste of your time if I give you the answer I'm showing you a process and then you can piggyback the process and then craft your own you know this process that you're seeing works in all markets that have liquidity and you know volume in fact in the trader lab we have traders trading NQ CL and others most of us focus on yes only because it's got high liquidity and you won't get skitted and it has adequate rotations you know on the current you know current conditions it's in to make it worthwhile notice the high volume notice the check these are triggering structures not trade recommendations they're just things you can study if you understand what makes this happen then you understand what makes that happen and you understand how if this was at a alignment an aligned location this would be a short you know now this is in a vacuum all right that's what we do in the trader lab so the stop indicator I'm getting out Jay's asking me about the stop iceberg detector and let me tell you what it is first of all this is a data that is from the CME and it's called market buy order data now think about it do you place an order on the exchange they got to know is it a limit order is it a stop is it a market order what the heck is this thing right so that's where the tag comes from so this is your sell icebergs these are buy icebergs and an iceberg so you know they pay to get ahead of you in the queue I mean I don't know if you know about it but not that it's that important but it's important to know only because more sophisticated players are using the icebergs typically but don't infer too much from it you know because you don't know what's this guy doing is he covering is it was it where was he short is he short from here going for three ticks what's he doing right you don't know so we don't know but here's how I use the stops so let's look here's how I use it and I find it very valuable let me try to get you a good example here I'm looking for a good one you notice what happens here is as you open a book map we can get into nanoseconds with book map and I'm going to tell you I can't see a nanosecond I don't know about you but look at look at how granular you can get so you know but as you zoom in it slows it down here's an example and I'm just going to show you something markets coming up seven stops exhaustion right this is showing me who's the buyer here and I'm just pulling this out of left field only seven stops a buy stop so if we break and here's the volume right in here and we come back up to this micro structure we might rotate off it that's all it's this is what it's showing me what it helps me see is exhaustion and it has to be in alignment with the location that's why I look for this and I don't know I mean this is not a setup this is just maybe right but I'm showing you how I use it so up in here break high volume pull back to high volume potential short here high volume pull back to high volume pull back to high volume pull back to high volume potential short and all I'm showing you is behavior and rotations I'm not showing you trades right I'm showing you how I can read the market with practice and this is why I always say narrate narrate narrate if this then that if not then what if it exhausts and it breaks and pulls back here there's your trigger and it's too high this auction then what if this and it doesn't take this out then what then that if I pull back to this high volume and it doesn't take it out then what then that if I pull back to the volume watch the volume then what then that what do you think guys now not a setup behavior this is where these are called triggers and in the trader lab we discuss triggering structures so how do you do this well where are we in the higher time frame south of the border where are we currently potential rotational trade I don't know outside in from wherever where's your setup I don't even know I'm not looking high volume is here outside in potentially outside in now longs only shorts so outside in outside and this is called mean reversion if there's not enough range you've got no trade because this is your obstacle this is like coming back to your vpok now let me take you into I'm taking now into the microstructure if this is the high volume in here this is the high volume in here so this is the same as that so microstructure in to the outside so mean reversion in in alignment with the higher trending time frame is that logical yeah j yes but again I'm sorry I didn't understand the what I'm a little confused here so what this is is the fractal so if you're in a downtrend how do you participate are you going to sell this thing here not so much unless you want to I mean if that's part of your plan me I need the counter rotation to get back in alignment what is the counter rotation in a directional move I'm going to go ahead and I'm going to go ahead and I'm going to go ahead it is an outside in trade or mean reversion it's a context or fractal context inside of a context and if you go to trader lab you'll kind of see what this is about or you go up on YouTube I've actually posted some streams previous ones on trading a trend configuration and mean reversion it's all the same guys so once you understand these kind of market mechanics and participant behavior you can start isolating them in fractals or micro structures and for me I initiate trades in this because I don't like losing I don't know why you would like it but you know what I'm saying by that is I want to minimize my risk of discovery of the location so if I can get my locations and maybe take a three-point or less risk per contract I'm good with that but my range has to justify that risk that's part of a setup requirement so you may see these trades and if they don't fit your trade plan your job is not to trade it your job is to narrate it and create the muscle memory to operate in a shorter timeframe just takes more skill because you can't be hesitating and when you're learning anything it's it's very intentional it's like playing music think if you guys have ever learned a musical instrument or let's say a language initially you are memory it's memory but it's it's a lot it's a sequential translation in a conscious state not an unconscious state for me once I see this I know what this is and then I know what this represents same thing here what does this represent you know I'd be risk neutral if I got taken out I'd be back on the same trade but that's me you might not want to trade like that you might think I can't I don't want to then you don't right it's all the same watch it's all the same high volume break pull back down high volume here break pull back pull back pull back pull back south are you guys tracking and Jay yeah the smaller amount of stops remember what the buy stops are they're buyers but they're passive buyers they're not initiator they're being taken out in the squeeze so those are weak hands so if the trend is down I want to see those guys get taken out and you can see them getting taken out up in here you know and over here that's thanks for playing we'll send you the parting gift this is still shorts right is everybody tracking they're 940 I don't know where it's going let me look by the way see I don't predict anything I've kind of gotten I used to think that though I can pick the high of the day to load I don't know any of that in fact I don't think about it I think about the participants because this is the real-time representation of what they think and those are the guys I want to align with the buyers and the sellers this is the next target down here and this is from a higher time frame it's been sitting here for so long it's got moss on it this is how I attempt to get an alignment now remember ah the whole goal of this at least for me it's just to have structure that gives me something to lean on and I accept the randomness the market never has to go here or it can go through here and not look back it can do anything right Carmen I don't know you're saying you don't have permission I don't know which what you're if you're trying to get on the trader lab they're filled up there's no room now the thing to do then is to watch it on YouTube it's why I have YouTube because we overflow I cannot let me try to post that for you guys in the discord chat if you're having a problem I'm going to post the link and you guys can do that well you know well if the trend is down I think the only way to go is south until it changes so there's no logs I mean if this thing turns around it'd be like turning a tanker around you know so for me and if it did that and I didn't get on it I wouldn't care you know it just doesn't matter to me what matters is staying in alignment until it changes it hasn't changed since really the open so I mean the only long would have been a long off the open which was responsive buying in this context after yesterday no long at least for me so it was short short short short short and remember the overnight volume point of control seems like a long time ago that was the location for a test of the eth retail remember it's the same as this that eth volume point of control is this except it was from that last auction now this is the developing point of control which has been migrating lower saying all that above us is too high in this little micro structure this is like a volume point of control in here too high too high too high test too high test too high test south you see all fractal once you understand how it works it's just like those nesting dolls you know higher time frame down down down down down down to the same process micro structure for triggers once you understand how it speaks and you can translate then it's the same process over and over that's why I consider I think of this as a simple approach really it just takes time to kind of organize it mentally and recognize it and then vet it you know in other words lay out a plan and you start from the top down you don't get cute and try to play in here because you won't you won't work this is a very advanced process and you have to be well I mean are you interested in taking the same risk here to go where where are you going you know five points six points risks three out of two lot you're risking six to do what see what I mean maybe not your trade maybe it shouldn't be your trade maybe your trade is to wait for larger rotations and that's your job or you're done for the day would that be terrible if it doesn't fit I'm just asking the prepushka dolls yes thanks Jim there's PDFs up there I'm not sure what we're asking about here the PDFs are Rod do you know what that's about there's a question there about what accessing my PDFs in the trader lab the 60 that are available or is there is that another topic oh okay thanks yeah you guys if you're in YouTube and you're interested in the trader lab and what we do there this is about creating a career a business of trading not fiddling not playing games it's a serious group and we're there to leverage our collective experience and help each other get better I watch my streams every day because I want to see things nuances it's practice it's deliberate practice do you have times built in you know in the business of trading there's what we do right here right now but there's also the review screenshots building a catalog of trades I showed you what Mike Miguel yesterday what he does he has everything broken down setups statistics mental state when I start trading every day I have a sheet I pull out I have to put my mind in a different place to trade I have to remind myself of my weaknesses things that I've seen over time that are not good you know that I do and uh because I have to be on guard you know it's unconscious and I'll tell you one of mine is I get off to a great start in the morning I tend to start becoming passive instead of like when you're in alignment and you have a day like today you should be doing your thing and just following your plan what I found and I didn't even know this was and it was really built on fear of loss and I had no consciousness of it what I would do is start backing off not taking trades because I'd be up so much you know and that's the opposite of what you ought to do like when you're in the rhythm and you have the rotations and everything is clicking isn't that the time you just keep doing it right I did the opposite I didn't know it I didn't know why either and the opposite of that is if I got behind in the morning when I was not in alignment or the market and the participants were not and my plan were not in alignment which is really what it was and I start going behind I actually got more aggressive when I should be more patient they were opposites and until I was keeping statistics I didn't realize it so I was keeping statistics and I saw some behavior and I said look what is this why did you stop trading and then on the other one why are you getting more aggressive this is ridiculous it should have been more patient you know because things were blowing past structures though something was weird so I had to change it so in the morning I start my trading I say okay mental notes I got a section on my brain basically here's your wiring here's how it interferes when you get this stimulus this is what you need to do I'm just mentioning because we're all the same in this business and I mean we all have the same issues it's what you're going to do about it if you ignore them you're not learning and you're paying a price and then the other part of that was and I suggested this for members of the trader lab and all of this takes effort and you know commitment create something called a error cost calculator the errors you make what does that cost you moving the stop not taking the trade start putting a number on it bailing out you know errors and you need to quantify the errors then you put a dollar amount on it and you put down and you see what it is then you take a check you write out that check and is it a thousand dollars two thousand five thousand dollars a week put that up on your monitor and then ask and then once you quantify an error versus just mentally ignoring it put a dollar value you want to create motivation that'll do it think about it Tyler you know there's been a lot of talk about as mentioning about the fractals it's all Fibonacci which is you know this natural order and I did a lot of work with Fibonacci years ago Elliott Way, Fib Extensions, Fibri Tracements time Fibonacci time cycles do you want to talk we can who is used to say you want to talk we can talk I spent tons of how about years working with different harmonics of Fibonacci shall we talk and all I'm going to say is none of that is part of what I do now because all of it added in expectations and expectations are just numbers and lines on a chart it still doesn't represent the current interaction of the participants in price discovery process so that's why I have none of it but I've done it just saying but that doesn't mean you shouldn't do it see I'm not going to ever say what somebody shouldn't do I'm only sharing what I do in my experience because then they're done that you know and it was logical to me because I quote believed it there is natural symmetry but what does that have to do with the price of the SMP the same so what I have found is anything you put into the mix if it has an influence and it adds randomness I would suggest you jettison it because now you have to quantify to measure it otherwise it's just random so I again just me strip out all the randomness as much as possible because this is random process needs to be consistent the fact that there's a number somewhere on a chart what does that have to do with the price of apples today this is based on participant behavior and it doesn't and by the way if we get down in here it can rip through here this is also in here too possible this if we get through here then here, then here we'll say lovely so any questions while we're here I've got about 20 or so minutes left I'd be happy to answer any questions you have if you're in YouTube and you find any value in this if it's helping you throw a thumb in there and if you're interested in what we do in the trader lab I invite you to come visit you don't have to be a book map subscriber you won't be solicited and there's a lot of additional education order flow stocks how to operate with stops icebergs market maker behavior options much more algorithmic behavior and of course order flow to the nth degree all these are pieces and you can add them and layer them in to whatever extent you need trader lab is really about building a business of trading so that's not a trade calling room the thing about this is it's not what I do it's what you can take away from this you know and make your own there are pieces that you might find that I do that you don't you know don't apply or you know or a conflict it's all okay it's not about there's no right way there's only a way and if you approach a like a business I think you're gonna have a much better opportunity to stay in it and remove as much of the randomness as possible so you can codify a process and measure it that's really what this business is about it's really all it is just like think like a you know think like a casino really and know what your stats are if you have statistics you can create confidence and manage your fear no no statistics it's just gambling and you'll always be fearful I don't know how you can manage it without kind of knowing what you might have and what the odds are and that's all about the odds the odds are against retail traders because they don't understand the business is right so maybe you know and of course past performance is no guarantee if you do results and I can't say that this will work for anyone what I can say is if you come to Trader Lab you'll see traders making progress and that it is having a material impact on their outcomes and you know like everything your mileage will vary if you're interested go to bookmap.com join the bookmap discord chat come to Trader Lab there's 60 PDFs to download plus all the additional education and a couple webinars and you know other things plus all that other education you don't have to be a bookmap subscriber you will not be solicited and you check it out any questions right are you asking me aren't y y y right right are you asking me what I would need to see or you're asking to somebody else they're in youtube to take a trade r y y I'm not sure you're asking me but if you were go to bookmap.com join the Trader Lab discord chat you're gonna there's a lot of information on there on trades and setups that we discuss in alignment with the auction using the process of the auction and of course now again remember what we were talking about short short short short short short pullback short these are not recommendations but I've been narrating them for you and again it has to be aligned with your trade plan these are not trades unless it's part of your trade plan otherwise this is the last one up here and then you would manage it or you'd be out of it subject to your plan or you'd put this back on and get scaled this comes in watch see how the behavior might work here for you high volume notice here so that's retail up in this consolidation breaks pulls back this comes in it's a potential short or you're just using the microstructure up here there it see it it's all there short I was narrating it but I'm not recommending anything as you guys know and you see it as far as buy ice it means nothing to me buy it's not my priority of input I'm looking for the seller I'm not looking for the buyer now you can use ice if you want but you don't know what the intention of ice is you see here's the thing the is this guy covering or is he gonna pull this is what you don't know about liquidity it's the the order book to me is like a banana peel you can slip on that thing see this algorithmic behavior see how the book is responding so watch the other side of the trade if they pull they might have just been pushing it up to get short this is what you don't know this is the layer you want to watch right here watch this here on this rotation up this is a different conversation and this is not really what I go into in the trader lab you've got Bruce at book map who's our order flow specialist but watch the behavior right there it's not a recommendation I'm just talking about order flow I'm not talking about anything more right here so we want to watch behavior in here let's watch nothing more than watching behavior this is algorithmic behavior algorithmic you see them coming under this is like somebody giving you a pinch on the butt a goose let's watch this here okay any questions while we're watching this thing we're watching for behavior here and I have no clue but let's watch no clue what you're looking for is right here do it does a seller show up in here let's just see I don't know this is not you know my thing right let's watch Osterman funny so the issue here the question is going to be what happens in this area right here right here here here watch not a recommendation this is how we all learn together including me why would we be looking at this we want to see here if this comes back in again in this area and if there's behavior or not now this is an auction this is the outside edge of this auction so think of this like a consolidation right so bing bing too high we broke down broke away there's your low volume area it's this up here in other words this is not an auction remember low volume areas tend to come up and fiddle in there re-auction so this is your outside edge what's that outside edge as a consolidation stops so we're looking here in here to see the behavior for me the primary chassis remember is this not this but i want to see behavior now so i'm looking outside and if we come back we could come back here so let's watch it but these are not trade recommendations we're attempting to observe behavior trend is down and how do you remember how do you potentially get involved in a down trend mean reversion outside potentially in so this would be in so if the big question if and it can do anything remember lunchtime in chicago fine let's go to lunch market tends to thin out algos can do a little better because they can move it into our stops but we are looking now to see if we can come up to an outside edge so let's watch and these are not recommendations because who knows you don't know what do we know I don't know watch so we'll watch this and we got about 10 minutes in the order book in the order book a little pressure outside edge if so we're going to watch this structure and potentially are not not a trade recommendation we're trying to find an outside edge right this is micro you know and this is nothing I suggest anybody do until they really know what the heck is going on it's easy to get sliced here now if you understand micro you could have a very tight stop but you have to be in an unconscious level and you also have to be in a trade plan that's okay with getting getting popped for small losses so let's just see what this thing does algorithmic behavior you want him to disappear there he pulled you see that's how algos behave this one now you want to see this come down remember this is our target so that means if you got short here using a shoehorn not a recommendation outside edge right we talked about it this is called mean reversion this is the mean so you would want if you got into this thing now here's how I think of it minimum and this is just examples this is not trades right if I got short here or here 40 half my stop would be here 42 whatever two points two and a quarter or if I enter better you know see I have to be quick better I can trade my stop is behind this structure if I get this rotation I'm a risk neutral my stop stays here now this could be a target or let me put to you this way if I don't get risk neutral here I want to get scaled ahead of this because this is mean reversion as everybody understand mean reversion what is mean reversion any questions so let's watch this so you're scaled and risk neutral here you're biting your fingernails this is the mean of the mean reversion that's the mean so your scale would be in front of this then you're holding this is a setup we discuss in the trade of lab not a recommendation any of you guys in the trader lab does this make sense have you seen this before how youtubeers if you've been following this stream have you seen this before this is a mean reversion trade it's a context inside of a context so remember if you and if you follow the stream you'll see this all the time because it's a way to participate in a trending configuration which means only shorts today so no long you know unless you it's dirty Harry says do you feel lucky mean not so much I just want to stay aligned until it changes right and then how do you participate that's what mean reversion is outside in trading so the context is rotations with the downtrend so the trend is down I don't think you want to be a buyer today unless you're covering again not a recommendation if you can be a buyer and it works statistically by all means it's and help me be a buyer then but this is my trade this is my location remember outside edge mean reversion wherever the heck it was they could just moved scale and then hold and we might so you understand we might just continue rotating or or or go lower are you guys tracking or ash I don't know about that VWAP I think it's busy elsewhere we don't have to ever get back to the VWAP if it did that's a setup in the trader lab VWAP the VPAC and you guys in the trader lab already know and the I below all these are potential opportunities to get short if we got back there this is another target down here 3910 and this here 3920 it never has to get there it doesn't matter I just know it's there and what I do is if the auction creates a level I know the market has a potential at some point underlined to maybe get back and check it because why did we leave it why was it too high up above in the higher time frame why are we coming back it's price check in the big aisle that's how this works it's all fractal if you're interested in this if you're in the trader lab this stream will be available to review I think it's worth reviewing maybe I'll post it up on YouTube kind of make it pin it up there for you guys for a while if you want to look at it you know maybe over the weekend and you know just maybe not I've already got examples of these behaviors up there so I don't know if it's worth putting it up again but if you're in the trader lab you can review this it's available for 24 hours those of you not in the trader lab I invite you to come I don't do trade calling and you were going to wonder why I'm not here to impress you I'm here to help you I'm here to help you understand the business of trading you need to do the work otherwise it doesn't imprint the idea is to create an imprint like learning to dance or music you know where it becomes unconscious competent then you only get that by doing the work so I find trade calling where it's a complete waste of time because you're not learning how to trade you're creating a dependency so I mean there might be value if you find value in it then by all means but I think this is about when the trader lab doesn't exist anymore that you maybe have something you know I've been doing this going on for 43 years and I can tell you there's a lot of things that come and go but once you understand something it's yours so I'm hoping that for some of you that you can make this business your business and make it into your own because what'll happen at some point is once you get the aha you know that aha moment and it starts making sense and all of a sudden you're navigating and translating and narrating and you have an understanding of why then you can take the kind of like take the blinders off and you'll see the light and you'll also be able to dance in any time frame that fits you know your parameters you know for example the short out here is this your trade well it's my trade might not be yours well then yours is you know higher up still your trade this is just fractal it goes down and down and lower lower lower lower and to micro micro micro until the range doesn't justify the risk unless you can execute that comes from that intentional practice yeah moon walker saying I did post something to these types I mean trend day configuration trading reports mean reversion you know different things these are all posted up there for you guys you know and you kind of sit back you have a cocktail on a weekend and you watch them some of them are four hours long you and you can speed them up you know and get through whatever is not of interest to you then stop it go back and you know just go take screenshots this is what it takes to learn the business it's really all the work you have to lay out to create a business plan and that's in my opinion all the only way to be able to be in the business versus just being a tourist passing through saying yeah I was a trader can't do that well come to the trader lab I think you'll might find some different opinions on that and everybody's mileage varies it's there's no you know when it comes to this or any business not everybody succeeds in any business and the fact that there are some tools available doesn't mean you'll be able to master the mental state which ultimately is going to be your biggest obstacle it's going to be you believe it or not though we all think it's a setup or an indicator or something that's not the issue ultimately once you have if you have metrics that's the solution I think to managing the mental state if you don't have the metrics you're always going to be flip-flopping because of the chemicals that are released into your brain you don't have control over that you do have a control over how you can tamp down that response hope you got something out of this today I appreciate you guys visiting the trader lab last time of course if you're interested in the trader lab you want to join a community of like-minded traders who are serious this is a serious endeavor this is about business it's you know we do have fun occasionally in the trader lab but it's a very serious environment for those who want to be in the business of trading there's plenty of other chats and vendors where anything goes that's all fine that's not what the trader lab is about it's serious and if you're a successful trader I invite you to come and contribute to the trader lab this I'm looking to get better also I'm constantly striving to improve trading is a journey it is not a destination it's a matter of getting better and better and better and practice intentional practice vetting replays the business of trading isn't just sitting here it's everything you do outside of this moment to bring you to this place so you can interact with the market and develop the confidence and accept the randomness of the outcome of any trade and just see it as overhead it's not about you being smart being right and yet we think that's we're wired for that it's about you having a plan following a plan and accepting the random outcomes and then looking at a distribution over a large sample size don't be the gambler be the house choose which side of the financial table you want to sit on thanks for being here go to bookmap.com join the discord chat if you're interested in the trader lab find your way to the trader lab take advantage of all the education bookmap will offer stocks options swing trading crypto mark a make a behavior order flow and much more thanks again guys appreciate you visiting the trader lab today I'm going to put up our process so you know what's behind all of this this is what the trader lab is about auction market theory how the market works participant behavior you had too low retail and all timeframes the volume profiles just price and volume allows us to see inside the price to know what the participants think about prices the time frame is the fractally operated it's top down bottom up context this is the moment of the more confusing elements the trend is down today but we're using counter rotations or mean reversion to participate in it and then the tip of the spear order flow how do you interact at a granular level this is the process of the that we use in the trader lab and a lot of tools using bookmap order flow tools stops icebergs order flow micro structure these are the pieces if you're interested go to bookmap.com join the bookmap discord chat come to trader lab and you'll be able to see this in play and other like-minded traders who are doing the same thing and it's by all of us being in this together maybe we can be better thanks again for visiting the trader lab guys look forward to seeing you tomorrow trade safe follow your plan and manage and mind your risk