 Good morning traitors. Welcome. Welcome to the bookmap channel. My name is Charles. I'm from a community called Pirate Traders where we are focused on the ES, the NQ and the two-way auction process. Well, what on earth is the two-way auction process Charles? We don't understand. Well, that is just basically looking at the market purely as a competition between buyers and sellers. Choosing to look at the market purely in terms of supply and demand, minute by minute, day by day, as opposed to trying to use any kind of fundamentals or anything like that to give us an edge in the market. We are purely focused on the technicals, what information they tell us, and what the highest probability of what comes next is based on that information. The two main tools that I'm using, you see here up on the screen, the left side of the screen is called Market Profile. Market Profile is just showing us the price action of the market, very much like candlesticks. But instead of having the candlesticks that are sitting side by side, it takes all that information and it compresses it together to make it easier for us to visually see what levels the market spends the most time in. So when you see these little letters, each one of those represents like a 30-minute candlestick, but by putting them on top of each other, by smashing them all together, we can see where the market has spent the most time. And then next to that, you get the volume profile that is showing you how much volume actually traded. Very important to understand, where has the market done business in the past is likely to want to do business there again in the future. And then over here on the right side of the screen, I have the book map chart. And the book map is a really unique tool because it allows us to see both the liquidity that's currently in the order books. So everything over here on the right side, that is what is currently in the order books. But everything that you see over here shows us where the liquidity was at that particular time after the market trades. So we can see on the market profile where the contracts actually traded at a particular moment. But by looking at book map, we could see where there was liquidity sitting at that particular moment. And that's an important nuance to understand the difference because the volume tells you what actually happened in the market, what's really going on, the liquidity shows you what kind of games the larger players are trying to use to move the market around. And it's not an exact science. You never know exactly what's going to happen based on the fact that you have liquidity above or you have liquidity below or whatever the case may be. But when you start to notice the patterns of how that liquidity adjusts and changes throughout the day, it can give you an edge. You can recognize things that other participants aren't aware of and take advantage of that. You may also see me click back here to a screen that shows you a bunch of other charts. This is what we call the market internals and this just kind of gives us an under the hood look at the market. This is looking at the exchange level products as opposed to the market profile and the book map where we're looking at the futures contracts. So the way I like to start the week every week is with what Jim Dalton calls the top down approach. The top down approach is essentially just zooming out and looking at the market, you know, on a longer time frame to see if it gives me any sort of information I can use on a shorter time frame. I'm a day trader. Most of the trades I'm going to take I'm going to be in and out of within a few hours. But by looking at what the market is doing on a monthly basis on a weekly basis on a daily basis, it can give me insights I might use in today. So let's begin with the monthly. Okay, not a lot to be gleaned from the monthly chart here today. What do we have? Well, we had balance over a multi year basis. We are breaking out of that balance that is bullish to see it does tell us that at some point at some point this momentum created from the breakout is going to run out. And when that momentum runs out, we need to come back down and test the area around those previous all time highs in the 48 hundreds looking for support there. That would of course be bullish for continuation for years to come, right? If you're balancing for years, you break out of that balance, you come back and you back test it, you were likely to get momentum for years. You were likely to get something that continues higher for a very long time. So we have momentum now, no reason to assume that it can't run out. But when it does, we'll be looking to come back and test those previous all time highs to see if we have buyers. So not a ton to be gleaned from the monthly. Let's zoom in and take a look at the weekly. See if there's any more information there than what we had. So if we look at the weekly basis, we can clearly see the momentum in the market, right? This is unquestionable. Just almost straight up momentum. We had a little tiny bit of balance in here. We'd a little tiny bit of balance in here. Actually, that was kind of a decent amount of balance. But for the most part, this thing has just been like a rocket ship going straight up. So the same information that we took away from the monthly, this thing has momentum. It can keep going. If we make another weekly high and we keep the low above the previous week's low, there's no reason this thing can't keep going up this week and next week and next week and next week. They have the momentum. The train is a going on a weekly basis. And so they can just keep it going until it runs out of steam. However, one important note that we're making on the weekly basis is you can see all this momentum here on the weekly basis. And then we finally made a lower low and what happens? We had to spend a couple of weeks going sideways. So if the market were to come down this week and get below last week's low, which is at 49.37, well, then we would expect it either needs to spend time going sideways like this or we might be looking for a larger pullback. Okay, but as long as we're above last week's low, there's no reason this thing can't just keep going. All right, so now let's zoom in and take a look at the daily timeframe. See if there's any more information there. Okay, so we've got a channel that we've been watching on the daily timeframe. And this channel is giving us some insights as to where participants might be running out of steam, right? The upper end of the channel is where they are starting to take profits and the market is running out of steam. The middle of the channel is acting as support where buyers are stepping in. But when it fails, they're heading to the opposite end of the channel. This was what we call a look below and fail, which happened a couple of weeks ago. That was because of the FOMC. Okay, so the market got freaked out. It panicked. It squeezed a lot of buyers, but it brought in stronger hands. And they turned around and took it right back up to the opposite end of balance within two days, just like that. So that is a market that is in balance. That is the behavior that we would expect to see. We would expect to see it to run out of momentum at the upper end of balance. We would expect it to find momentum at the bottom ends of balance, find support. And if it were to look below and fail to turn around and head right to the opposite end. So what are we looking at today as we're looking at this daily chart? Well, we're thinking, oh boy, we are opening right up against that trend line. We are opening right there. So in my mind, there are two options for what the market can do today. It can either get resistance and then it needs to start to pull back down towards that opposite end. Once again, looking for support or it can try to break above. Now if it can break above and come back down and create some support, that is insanely bullish for momentum to the upside and it can keep going straight to the moon. That to me is less likely to happen. What is more likely to happen here today is that the market would poke above there and then fail and come back in. So I'm keeping a very close eye around yesterday's highs. I'm thinking if the market is going up to yesterday's highs today, it's really got to find new buyers up there. It's got to create some excitement, some momentum. They got to force some shorts to cover. They got to bring in some FOMO buyers. They got to really create some momentum up there if they want to keep going. Otherwise, what in my mind is the higher probability is that they would get above yesterday's high, try to create momentum and then fail and come back in. And that failure could bring us right back down through Friday's lows. So that is the area that I'm watching on the daily. So now let's zoom in even more. We'll look at the market profile chart and we'll try to give ourselves some ideas of, okay, we know we kind of have a plan for what we think is going to happen. We think either the momentum is going to keep going today, market is going to push up above yesterday's highs, it's going to bring in new buyers, it's going to keep going, or it's going to fail and need to head back down towards those balance area lows, towards the bottom end of that channel. All right, well, how will we know which is happening as intraday traders? All right, the first nuance that I am watching is the way the overnight traded. So during the regular trading hours on Friday, we closed up here in the upper end of the range. That was bullish to see. Why was it bullish to see? Because we left behind just one little single print there in the G period. But that one little single print is doing a job. It's giving us information. It is telling us that once the market broke through this level, we were playing some tug of war right here around 50, 30. The market was trying to decide, do we want to go up? Do we want to go down? What do we want to do here? And then it broke higher. Once it broke higher, it went straight to the previous night's overnight high. Once it got to there, that was where it should have run out of steam. All the buyers who had been stepping in to push the market up there should have taken profits and gotten out of their trades. And as soon as they got out of their trades, the market should have come back down to the fairest price of new business that day, that 50, 30 area. Is that what happened? No, sir. It is not. Instead, what happened was the market brought in all these buyers, got to that overnight high, and then went nowhere and just continued to bring in volume and spend time up there at the new all-time high. That is information from the market. That is telling us that some of these buyers have not taken profits yet, and there's no strong sellers stepping in trying to smack the market down. It's pushing to a new level, and there are people willing to do business at that new level. As long as the market continues to do that, as long as it continues to push to a higher level and bring in new buyers at that higher level, it can just keep doing it. Jim Dalton says traders will do what works until it doesn't. So as long as creating a node of support, little tug of war, pushing higher, little tug of war, pushing higher, little tug of war, pushing higher, as long as that keeps working, they'll just keep doing it. They'll keep pushing the price higher, bringing in more buyers, and so on and so forth. So the next question I'm asking myself, okay, at the end of the day on Friday, I'm feeling like we still have some momentum. There are buyers that have not taken profits, and there's no big sellers stepping in up here. So what do I want to see over the weekend? How do I want to see the overnight market digest that information? Well, if I'm a bull, and I think this momentum is going to keep going, I want to see them stay above that single print. I want to see them stay above 50-34. If they can, it means that what's happening in the overnight is the same thing that was happening in the second half of the day yesterday. Just more tug of war, just more balance at a higher price. So as we get ready to open up this morning, what do we see? All weekend long, all the time, all the volume brought in in this upper end of the range. So that tells me before the opening bell even rings, this market has momentum. The buyers haven't given up yet, and the sellers haven't piled on yet. So it's going to keep drifting higher. I also have an excellent level to tell me if I'm wrong, which is the base of those single prints from Friday. So as long as the market stays above 50-34 this morning, I'm bullish. Now that doesn't mean the opening bell is going to ring, and this thing is going to go straight to the moon. That's not what I'm saying. What I'm saying is it's going to chop, it's going to grind. Look at this, it chopped and grind at the end of the day yesterday. It chopped and grind all weekend. It's probably going to keep chopping and grinding this morning. We're probably going to get a lot of rotation up and down, up and down, up and down, up and down. But as long as buyers at the lows continue to step in somewhere above the base of that spike up, or sorry, the base of those single prints up, I know the higher probability is that they want to test yesterday's high and see if they can keep this thing going. So I will be bullish before the opening bell even rings. I will be bullish looking for support. If that level breaks, if the market starts to pull back to the base of those single prints and that does not become support, and we start to spend time and bring in volume on the lower half of Friday's range, well then I instantly change my mind, right? Because of the context that we have from the daily chart telling us that we are at the upper end of a balance area, we're at the upper end of a channel, we're going to break out of this channel or they're going to go back down. That's what's happened every time. Tried to break out, couldn't do it, came back down. Tried to break out, couldn't do it, came back down. Couldn't do it, came back down. Couldn't do it, came back down. Okay? This day today, right here, could end up looking just like this day right here. What happened on that day? The previous day we closed right at that high, right at that balance area high, that channel high. They couldn't take the market higher the next day. It looks like they barely looked above the previous day's range, and they couldn't keep it going. So what happened? Right back down. And then the next day was that FOMC day. Okay? So we could very much have a day that looks like this today, where if we can't keep it going, if we can't get above Friday's high and find support, the and find support is a very important part, because you can poke above and fail and come right back down. But if they can't get up there and find support, that is what is likely to happen. Okay? So all I have to do when that opening bell rings is, watch the market shop, watch it grind, watch it do its thing and go up and down and up and down and up and down inside this range, and try to ask myself, you know, what is it doing? How good of a job is it doing? Are the buyers stepping in at the lows? Are they creating that support? Are they holding this 34 level? And if they are, I know the higher probability is that we're going to poke up and test the all-time high at 50-48. Once we get above the all-time high, all I have to say to myself is what happens up here? Do we get this again? Does it push up and just spend time and bring in volume up here? Or does it push up and fail and pull back in? So I know as long as 50-34 holds, we're likely to test 50-48. As long as 50-48 holds, we're likely to keep the momentum going. Now, I don't know how far they can push it. It's blue skies. Who knows? Who knows where they're going to take profits? Who knows where the sellers are going to pile on? But I know they have momentum, and I want to be in a trade with that momentum. Okay? Any questions from the chat? Good morning to Killzone. Will is here. Good morning to the demo trader. Vu. Hello to you. Jerry is here. Nap. Rui. Bust a move. Jay says the casino is open for us in Pyridice. Never gets old. Sebastian, good morning to you. John says, can I propose to my girlfriend on this stream? Yeah, man. Go for it. We're here to support you. I assume she's a trader. Ida, good morning to you. Ships in the house. Rui says, why the single print at 50-34 as in bookmap, no liquidity at that level? So here's the thing. I don't know for sure that 50-34 is going to hold as support. If it did, it probably wouldn't be a big yellow level just sitting there waiting to hold it as support because often the liquidity is there just to trick you, right? Like it's just there to make you think it's going to be support and then it disappears or to think it's going to be resistance and then it disappears. That's why I use bookmap, right? Because it gives me an edge in that understanding. So when I say I'm looking for support above the base of those single prints, that doesn't guarantee that it's going to come down to a tick to that exact level and then turn around and head higher. It might do that. I mean, you can see that happen all the time. But that's not necessarily the case. The point is we're going to chop. The point is we're going to grind and go sideways and do buyers step in anywhere above there, right? If they keep stepping in anywhere above that level, it is likely to test yesterday's high. It is likely to test Friday's high, okay? Now, if that level breaks, if we get back down to there and it doesn't act as support, well, then I know my narrative is wrong. The idea that we're going to break out of that channel on the daily, right? That we're going to break out above here and get new momentum and new buyers and take this market straight to the moon. I know that narrative is wrong, okay? So that's the job that the single print is doing today. The job of the single print is to give us information, to answer a question, are we building support to keep going, or did we run out of steam? Do the buyers from Thursday and Friday start to take profit this morning? Do new sellers start to pile on? Does the market start to pull back, okay? So that's not an exact support level, although it might work exactly as a support level, but that's not the way I'm looking at it. I'm looking at it as a place to change my mind, a place to have an understanding of what is going on. Good morning to Michael Frito in the house. R.K.? John, can you get in a prenup? No matter what, get a prenup. David G., good morning to you. Steve 66, welcome. Any other questions from the chat? Anything I talked about didn't make sense. You don't understand. What do you mean two-way auction process? All right, no questions. Let's jump over and take a look at the queue. We'll do the same thing there. All right, queue's got a lot of momentum. Let's zoom out and take a look at it on the wider timeframes. So on the monthly, exactly the same as the... Let me get rid of this old fib. Okay. On the monthly, it's exactly the same as the ES. We are one timeframing higher on the monthly, so as long as they can keep it going, they can just keep it going, but they do need at some point to come back down and back test those previous all-time highs. So they could push it higher for another month, and another month, and another month, but at some point they'll want to come back and make sure that that 1,700 area can act as support. That's no reason to go short. You need to understand just because the market, once a pullback at some point doesn't mean you short now. The market is telling you it still has momentum. Don't fight that momentum. Wait for that momentum to run out. All right. Well, we're talking about momentum on the monthly chart. Charles, how do we know the momentum's running out? Well, first we'd see a change in momentum on the daily. Then we'd see a change in momentum on the weekly. Then we can assume a change in momentum on the monthly. So let's zoom in on the weekly. Once again, same thing. Very similar to the ES. Tons of momentum to the upside. However, one thing that jumps out at me is that this channel is very tight. That is an extremely tight channel. So that is a sign that the market is pushing itself too far too fast. So I would be less inclined to assume they can keep this momentum going on the NQ as I would be on the ES, which is a much more orderly sort of channel. The NQ looks a little bit like it's getting itself overly exhausted. We also know because we are one time framing higher on the weekly, as long as we stay above last week's low, around $17,500, the market can continue higher. But if it dips down below that low on the weekly, we're looking for a little bit of a pullback. Let's zoom in and take a look at the daily. Boy, this thing could still have legs. Actually, looking at it on the daily, you had a lot of balance in here over these periods of days. You've broken out of that balance. So once again, at some point they want to come back and test it. But after this much time going sideways, they could have a few more days of continued upside momentum. So both markets are kind of in exactly the same position. They're either going to keep it going. They're either going to get above yesterday's high, find new buyers and keep going, or they're going to fail and pull back down. So now let's zoom in and we'll look at the market profile chart and try to find some levels to give us an idea of what's happening. Same thing. Y'all, these two markets are moving in sync right now. Okay, so the same exact thing on Friday, they left behind a set of single prints. What happened in the overnight when they tried to break below those single prints? Completely ran out of business to the downside. Spent almost no time, brought in almost no volume. So that tells us that that base of single prints is acting as support as of now. As of the opening bell this morning, that is acting as support. So I would very simply say what you're looking at here is a chop zone on the NQ inside this overnight range. So once that opening bell rings, they'll probably go up and down a lot. There'll probably be a lot of grinding around inside this range. But if they can get above 18.063 and turn it into support, they are likely continuing much higher from there. If they get below 18, we can just call it 1800. If they get below 1800 and spend any significant time or volume down there, they're likely looking for a larger pullback. Why do I say that if they spend time below that low? Well, they poked below it in the overnight and they spent no time and they brought in no volume. Well, what happened? They just looked below and failed. They came right back up. So that could happen again this morning with the overnight low. They could come down here and just poke, oops, come down here, do, do, do, do, do, poke below there and then turn around and come right back up. So both the overnight high and the overnight low, they would need to get above it and find support or get below it and find resistance. But if they do look for continuation in that direction. As long as it's between those two, look for it to just go sideways. And if it looks above and fails coming back in or it looks below and fails going back up, assume more chop, more grind, more sideways. They did it for the second half of yesterday and they did it all weekend long. So there's no reason why they can't keep grinding this morning. It's a chop zone. Do, do, do, do, do, do, do, do, do. Rue says, and so I understand this single print level to test is by experience. It's what market uses to do, right? No, single prints have always acted this way. So single prints are likely support or resistance, right? So these were single prints up. They're likely support when the market comes back down and vice versa. But that doesn't mean they have to be is the point. It doesn't mean the market has to backfill those single prints and like a guarantee that it's going to do it because when it doesn't do it, right? When what should happens doesn't, it should pull down and backfill that single print. But when it doesn't, it's giving you new information. It's telling you, we still have buyers. We don't have sellers. That's what it's telling you. Well, what happened on Friday? We created those single prints in the G period. The H period tried to come down and backfill them couldn't do it. So at that moment on Friday, the market was telling you we don't need to go down. We have no need to go down. So let's see how far we can go up. And then we just went straight up until we finally made a new all-time high and then we went sideways, right? Well, what did the overnight do? It just went sideways. So as of now, that signal that we still have momentum, it still exists in the market right now. So why on earth would we think we have to pull back and test the single print? Or we have to pull back and repair old weakness. We don't. We don't have to. The market has momentum. It can just keep going. So that is what the information tells us. Now, maybe the market does need to pull back and test it today. Then we'll find out, do the buyers step in once again, the way they stepped in on Friday? We just have to wait and see. So there's no guarantee it'll get tested. There's no guarantee it'll be support once it does. But if it doesn't get tested, we're bullish. If it gets tested and finds support, we're bullish. And if it gets tested and doesn't, we're bearish. Right? That's how we're using it. Let the chop begin. First minute of the day, we already got a low volume high and a weak low increasing the odds. We're going to go sideways for just a little bit here and chop it up. Hip hop. I don't understand the reference. But thank you for your enthusiasm. Tom Gunn says, we're in a chop zone, baby. All right. There it is. It's a chop zone. Good morning. Scalping strategy. Armando says, chop zone. I thought it was a bull market, you know. No, I am bullish to be crystal clear. I am bullish as long as we're above 5034. But what I'm saying with the chop zone is it will have to go sideways first. It will have to spend a bit of time grinding around, going up and down, bringing in buyers, bringing in sellers, you know, squeezing them, popping some stops, squeezing them, popping some stops, you know, doing its thing, chopping around. But as long as it is above 5034, yes, I am bullish to at the very least test yesterday's high and then monitor for continuation higher from there. Why? Because it's a bull market, you know. All right. The market's turning half back into support that increases the odds. It'll try to poke up and test 5046. No, couldn't hold it back for the weak low. So as always, when the market is in a chop zone like this, when I think we're in a range where we're just going to grind and grind and grind, the things that I'm watching is first support and resistance levels. We can tell there's resistance up here. Okay. We ran out of steam on Friday, spent less time, brought in less volume, ran out of steam in the overnight, spent less time, brought in no volume. So we assume that's the resistance above. So once it pokes up in there, around 46, 47, we watch to see what happens. Does it poke right through or does it get resistance? Is it kind of like getting smacked down there? If it's getting smacked down, the next thing we look for is support at the halfback. I realize today they're very close together because it's such a tight range, but that's what we're looking for, support at the halfback. As long as that holds, they'll keep poking at the resistance, right? But if it fails, they come back down for the weak low and then we look for support down here. And we just watch how it pushes into support, pushes into resistance. What happens at the halfback? We just keep watching and watching and watching. Also, I like to watch the book map over here on the right side of the screen for what is called the stops and iceberg setting. I want to know when it pokes up and it comes back down, is it a machine that is artificially reversing the market at an exact level or is it just buyers and sellers actually getting squeezed? As of now, it looks like it's real buyers and sellers. Okay? So as of now, the bots aren't forcing this chop. It is just a natural auction process. Some people woke up this morning bullish and they're trying to get long. Some people woke up bearish and they're trying to get short. You know, there's 500 stocks in the S&P, so they're buying and selling all over the place and we're getting chop in the index. Choppin' buckles. Jay says hit that like button, y'all. Yeah, let me refresh and see how many likes. We got 150 people hanging out. 41 likes. What's it going to take to get the other 100 of you to push the button? Give me that little thumb, thumb. Okay, so it says Charles said something funny. I am a bull. No, I am a bull. What do I mean by that? I mean I want to own the market. I want to be a buyer. So I'm watching for that support. I'm looking to see where are the other buyers stepping in. Once I'm sure, once I'm confident that they are stepping in and that we are going to hold this level above 34, I want to join the party because they're going to take it to yesterday's high. And they might, they might be able to keep it going from there. And I can't chase the trade up there. Oh no, no, no. So I got to look for that support. Can't be looking for support if I don't know whether I'm bullish or bearish. If I don't know whether I should be shorting or longing. Ruby, can you please detail again what you said about looking for icebergs and stops? You look for examples for the reaction. Yeah, so when you get a chop zone, when you get a market that is just grinding in a really tight range, there's one of two reasons it happens. One is that genuinely, half the participants think the market's going to go up and half think it's going to go down and they're playing tug of war. When that is happening, all you have to wait for is for one side to win. So essentially, let's just pretend, I know this is oversimplification, but let's pretend that the only traders that are trading are the ones that have traded since the opening bell this morning. So half of them are going long and half of them are going short and the market goes up and the market goes down and the market goes up and the market goes down. So they can do that however long they keep doing that. As long as they keep finding buyers when they go down and finding sellers when they go up, they can keep going and going and going and going. But whenever it breaks out of there, whenever it gets above that overnight high or below that overnight low, one of those two sides is going to start to panic. So say it gets above the overnight high, anybody that's been selling and selling and selling, they're going to be like, oh shit, I should cover my trade. That forces them to become buyers. That's momentum up. So when it's real chop, when it is actually just the traders of the world don't know whether the market's going to go up and down and they're playing tug of war, whenever it breaks out of that range, you can expect follow through. You can expect the market to make a great big giant move. However, sometimes what happens is that it's artificial. It's just computers stopping the market at one level and stopping the market at another level and it keeps going up to an exact level and coming down to an exact level and it's just computers fighting back and forth. Well, how do we know when it's computers versus it's real traders? We'll see it on the icebergs. If you see icebergs selling at the high and you see icebergs buying at the low and the market is bouncing between iceberg to iceberg to iceberg to iceberg, well, then you know it is artificial buying and selling. It is somebody using the futures market to keep the 500 stocks in the S&P 500 from going anywhere, right? So when that is the case, then if it pokes above, it's more likely to fail and pull back in or vice versa. So it's just a little bit of an edge to know what's going to happen afterward, okay? It's not an exact science. It's just one piece of data to take into consideration. Because the question is always, are people buying and selling the underlying shares? Because they really think this particular stock that they like is going to go up today or is it a computer trying to compress the market's moves because it's trying to burn time to make money off of options, right? They're making time decay. And so sometimes they keep a tight range for however long they need to to make a bit of money to change the value of an options, you know, market and then they can let it go later in the day or whatever. So the stops and icebergs, you know, tool on a book map is the best I've found for differentiating between the two, okay? So they poked up into the resistance again and again and again, look at all that poking, but they couldn't get through. They couldn't find support at the halfback. So that tells us they need to push the market lower looking for buyers at a lower level, increasing the odds that we're going to repair this week low. But there could be buyers literally anywhere in here. So let's see what happens. It's a chop, so. Rui says, does it need to be an iceberg or can it also be stops? No, because stops are people getting taken out of trades. Icebergs is a machine entering trades. So if you're seeing large stops, which is what would pop up on the stops indicator, that's a bigger player getting stopped. At least the way I have my setting set up, that would be a bigger player getting stopped out. So no, that's not the same thing. It's the icebergs that we're watching. Do we keep getting red icebergs on the upper end of the overnight range? Do we keep getting green icebergs at the bottom? More chop. Chop and broccoli. Okay, they are making this low a very, very, very weak low. At 50-43, why do I say that? Why do I call it weak? Because they keep trying to reverse it right above it. And every time they try to reverse it right above it, those buyers are putting their stops just below. So eventually the market comes through to get that liquidity. The market knows those stops are waiting, so it has to poke down and take them out. Once they does, that weakness disappears. And we look for support. Nirav says, any patterns in market where market moves when certain stop run hits and reverse exactly from a stop run, vice versa, with iceberg? Not with icebergs, but what I just described is an example of that. So we know that they're building up stops right now right here below the opening price. There's a bunch of stops. So when they come through that opening price, we would expect a little pop, a little boop, a little pop lower as we take out those stops. What could happen is they just absorb all those stops and then turn right back around and head up. Or what could happen is they absorb all those stops and then they get new selling in here. So that's what we're watching for. Are they just coming down to sweep the order book real quick, get themselves some longs and then head for the overnight, or for the, for Friday's high? Or is there just more tug of war? You know, are we just still doing battle? That's what we'll find out once they take out those stops, once they repair that week low. DB says, is there a video to show us how to set up our footprint study? Well, I don't use footprint, but yes, Bookmap has an incredible amount of resources for, you know, all of their software and settings and everything just dig through and you'll find videos to show you how to set everything up. People that are in my community, members of the Pirate Traders Brigade, they know in the Discord they can find the software and settings the way I have everything set up for my Bookmap. But you don't have to copy me. That's the cool thing about TA. You should get, you know, get your own Bookmap and try everything, set it up in a bunch of different ways. Look at what works for you and what doesn't. Experiment. You know, everybody's brain is a little bit different and connects with information slightly differently. So I've got my setup that works for me, that I like, doesn't mean it's the right setup for anyone else. You should experiment and see what works best for you. There is no such thing as right or wrong in TA. Everything that exists exists because it works for someone. You just got to figure out what thing is right for you. Look at this, they're making this low even weaker. Tom, is the market affected by the Chinese New Year? Oh brother, you're asking the wrong guy. I don't care about any of that stuff. I don't pay attention to any of it. So go back, if you scroll back to the beginning of this video, go back and watch the first five minutes of this video today. And I explain how I look at markets. I don't care what's happening. I don't care what companies are reporting earnings. I don't care like what's happening in commodities. I don't care what's happening with the treasuries or the US dollar or any of that shit. All I look at is what is happening in the price action right now. Are there buyers or sellers of the ES at this moment? That's how I make my decisions. Because as soon as I start to try to include other data, it gets very confusing. I'm less confident in taking trades. I'm wrong more often when I simplify it down to as simple as it can be. Is this a place I can do business? Is this support that I trust to hold? Is this resistance that I trust to hold? Okay, great. I'm long or great. I'm short. I'm easy to trade. Well, not easy, but simple to trade. And I'm going to have a much higher win rate. So for me, less is more. The less information I'm taking into account, the easier it is to understand what's happening. Sean says, do you ever use the volume charts on the right side of book map? To be honest with you, no, not really. I always kind of think I should pay attention to it. But I'm laser focused on the liquidity in the current order book right here. This is where my eyes are fixed on book map, which is just like what is happening with the liquidity and where is it going and how does it change once it passes through real time. So this is like before the market gets there. This is after the market gets there. So for example, we talked about bots. I now believe this is bots doing this. Why? Because when we came down and almost repaired that weak low, we came so close to the tick of almost breaking through that weak low, which was the opening price. What happened with the liquidity? They piled a bunch above, they piled a bunch below. So that tells us they want more chop. They want to create more tug of war up here, which tells us what they want to build up more stops down here. So the game is afoot. Telling me don't jump into a long trade just because you're seeing some support. They're probably going to disappear this, go down for this, then disappear that and take out these stops. You know what I mean? So I'm laser focused on liquidity that's currently in the order book. And it's the same whether you're looking at it here or here. Here you're looking at the size of a candle. Here you're looking at the color. Steve says, is your market profile set up for full day or real time hours? So I split out my profile. You can see over here on the left side of the screen, the sort of blue and pink profile. That is Friday's regular trading hours. So from 9 a.m. to 4 p.m. That's one profile. And then I do from 4 p.m. till 9 30 a.m. the next day. That's this overnight profile, which is sort of the light blue color. So I split those two out. Now, obviously this was the weekend. So it's a little funky. But yeah, regular trading hours and then overnight I split the two apart because there are massive changes that that happened between the two. So for example, I talked about this earlier today. Oh, look at that. Look at it. Look at it, folks. Earlier this morning, I said with the NQ, I would use the overnight high and the overnight low as my chop zone. As long as they're below the high, they're likely to head back down. As long as they're above the low, they're likely to head back up. Well, look what the NQ has done all morning. Chop and chop and chop and chop and chop inside that overnight range. Now, if it gets above the overnight high and support, that's bullish. Or if it gets below the overnight low and finds resistance, it's bearish. And if they look above and fail or look below and fail, more chop, right? So the only way I can know where those levels are is by splitting out the profile in that exact way. And so far it's working like clockwork. Very nice. I like very much. DB says, where can I find a link to your brigade membership? Well, there's no links, but you can just type into the address bar at the top of your screen, piratetraders.io. And you'll see the button on the homepage. 10 bucks a month, you can cancel anytime. And I'd be willing to guess. Call me crazy. But I'd be willing to guess if every morning for a month straight I am giving you guidance of what the market is doing and what it is likely to do next, that at some point within a month, I will say something that will either help you make $10 of profit or prevent you from losing $10 of losses. Well, would you look at that? They just started to disappear the liquidity above and bring it in below at the same time. Well, shucks. They're playing some kind of game. They're trying to get you along so they can bring it right back down. So yeah, 10 bucks a month. The reason I keep the price so low is so that you don't have to worry about signing up. Sign up, check it out. If it helps you, great. If it doesn't, who cares? It was only 10 bucks. You know what I mean? And I guarantee you at some point within a month, I'll say something that will either save you 10 bucks or help you make 10 bucks. And probably I'll say things that'll have hundreds of dollars worth of value to you. Maybe thousands, maybe tens of thousands. But you'll never know if you don't sign up and check it out. Nareev says, could you please explain how high frequency trading algo works in markets where market provides liquidity often I've seen liquidity void from passive order is sitting for a long time. Does this make price away from? Yeah, so it's honestly it's far too complex for me to even understand, let alone explain. But there are just a million different computers trading the ES all day every day. There are arbitrage computers, right? Computers that are recognizing changes in prices of the underlying shares or changes of prices of like the ETFs like spy or changes of prices of the SPX and they are doing trades on the ES to match up with that. Right? So there's constantly these arbitrage bots that are trying to keep everything that is S&P 500 moving together. Okay? Then you've got the bots that belong to the longer term option sellers, right? So there are people that sell options on a weekly, monthly, quarterly type of basis. They use the futures to hedge against their positions. So for example, and again, it's too complicated for me to explain, but if it is in those market makers best interest that the market goes sideways for four hours this morning, it'll go sideways for four hours, right? Like they will use the futures to keep it stuck. They'll just use the amount of money that they have to force the market to stay in a certain range. So you've got your arbitrage bots, you've got your bigger players hedging in the futures bots and then you've got day trading bots. You've got bots that were programmed by Quants at big institutions that literally they just push turn it on in the morning. And all day it's, you know, it's self-learning. It's AI. So it figures out what to do minute by minute throughout the day to try to take advantage of little pockets of liquidity where it can make a few bucks here, make a few bucks there. Okay? There is also those happening from other institutions. So it's like there are so many mechanisms competing all day every day. So when you see how the liquidity is constantly changing, just look at the liquidity right here in this area below. Look at how the colors are changing second by second. They're putting in orders. They're pulling orders. They're putting in orders. They're pulling orders. Orders, orders, orders, orders. What are they doing? Well, one bot is trying to give, trying to trick another bot into like, oh, well, you shouldn't be going long because there's all this liquidity below and then they disappear it. And then that bot has to change its mind and try to go long. I mean, there's just this insane, like, infractions of a second. Computers competing against computers competing against computers. And we are just the cannon fodder in the middle. At this point, actual human being retail traders going long or short, the ES or the NQ, we are like a tiny little bit of the liquidity. And we just have to do our best to understand what's happening and not let those bots squeeze us because most of those bots, those day trading bots, that is all they are doing. They are simply reversing the market at an exact level, right? And putting in all this liquidity to attract to the market up and then disappearing it the second that the market gets there and adding more liquidity below to reverse the market back down so that when they come back through that weak reference, they can eat up all those stops that they just created by convincing traders it was about to go higher or it was about to go lower. And so, guys, you'll never be able to outthink these computers. I'm smart as fuck and I'm telling you it's not possible. They are changing day by day. They are self learning. They are fucking AI and they are so good at doing exactly the thing that will squeeze you as a trader because it's like you're convinced this is gonna happen and then they're, yay, it's gonna, and then they take it the other way. So the best you can do is to choose not to operate when you're in one of these chop zones. When these shenanigans are happening you choose to say to yourself I'm not gonna mess with this because I don't know what they are doing as opposed to what I talked about earlier. If the liquidity wasn't bouncing all over the place changing second by second, if there weren't icebergs at the high and icebergs at the low, if there weren't all of this bot activity happening, well then you could trust that a breakout would continue or whatever. But you can't right now. Right now it's bot shenanigans and they're gonna keep on doing it. So here's a great example. We're right back down at the low. So what are they gonna do? There's one of two options. As the market comes down here and it gets to that a period low either they disappear this liquidity just poof, it's just gone and then the market will come crashing through it taking out all the stops or they start adding liquidity up here which reverses the market right back up and they get even more stops in there. Right, I don't know whether this is the time they're gonna let it break lower or this is the time they're gonna head back up and bring in more stops so I must just watch and wait. It's a chop zone. Frito says please get Charles's charm five days a week. Yeah, join the brigade and this weird singing weirdo will just be in your life forever. Steven, do you think this kind of bot activity occurs in other markets such as gold and crude? No, sir. I mean, it does a little bit, right? There's always hedging going on and stuff like that but in terms of the like day trading bots they're mostly in the major indexes because that's where the most liquidity exists because of all that arbitrage, right? Because every minute of the day somebody is buying one of the stocks in the S&P 500 or one of the stocks in Nasdaq or one of the stocks in the Russell, right? So those stocks are moving up and down in value. So there has to be arbitrage happening in those indexes. So they just end up having way more liquidity available. So if you're a bigger player you want to be in whatever is the largest pool of liquidity. So they choose the indexes because that's where they can do business and they know there will be arbitrage bots to make up the difference in liquidity. Demo trader says can you elaborate on a chop zone your definition of a chop zone? So when we think about the market here we go testing the low again when we think about the market as a two way auction process there's only basically two things that can be happening. Either the market is rotating which is like tug of war. The buyers are trying to take it higher the sellers are trying to take it lower and they're just playing tug of war or there is momentum which is like one side is winning and they're squeezing the other side, right? And so you can see it very easily if you just look at like a daily chart it's happening on every time frame always, right? It's always happening whether it's a one minute timeframe or a daily timeframe or whatever you want it's always happening but you can see you get momentum then you chop then you get momentum then you chop then you get momentum and then you chop pullback momentum chop momentum chop pullback momentum right? So this tug of war is always happening where either it's two sided trade and they're competing to try to take the market higher or lower or you start squeezing the sellers right? And that pops the market higher and then you start bringing in more FOMO buyers and that squeezes more sellers and you keep popping the market higher and you get a move in one direction, okay? So in terms of the words that I use to describe things if the market intraday is rotating up and down in a way that I can trade in a way where I know where to get long I know where to get short I will know what's happening I can have control I call that a rotational market but when the market is in a place where I have no clue where it's going to river oh there you go took out the low and there was a one trader got taken out for 157 stops sucks to be you bro and isn't it interesting guys isn't it funny that the moment they came back and took out that low they disappeared all the liquidity where to go it wasn't real it was just a mechanism to get participants to do what they wanted so that they could come back and take out their stops okay so now we're asking can they create support can they bring in buyers and reverse the market back up for the high once again so yeah so the word chop just means this is one that I can't guess where it's going to reverse I don't have any edge so when is that the case generally speaking it's in the first hour of the day because in the first hour of the day there's multiple things that are happening right there are traders from the overnight that are looking to take profits on their position there are new traders that are looking to get positioned for what they think the market is going to do this day there are traders from yesterday's regular trading hours market that are looking to take profits so there's all this different activity that can happen in the first hour of the day so what I have found is if we are opening inside the previous day's range so this was the previous day's range the odds are we're going to get that tug of war we're going to get that chop in the morning so what I do is is I ask myself the question based on the information that's available to me what could be that chop zone so on the ES I'm saying anywhere above the base of these single prints up and below the overnight or below Friday's high why am I saying that? because if we get below the base of those single prints that will be a change in the market suddenly you'll start squeezing all the buyers and the market will head lower same thing if we get above yesterday's high that could cause a change in the market that could start squeezing all the participants that are short right? so as long as it's above the base of the single prints and below the high it's likely to just chop but I can't know exactly where it'll reverse I can't know whether it'll get follow through once it does so it's just not a place to do business now on the NQ today what did I say? well that I was able to get a tighter chop zone because they already tested the support at the base of those single prints in the overnight now I can say this is even easier than the ES as long as they're below the overnight high as long as they're above the overnight low it's gonna be chop do I know how many times they're gonna go up and down no I don't do I know where it's gonna reverse? no I don't right? do I know once it gets above or below if it'll get continuation? no I don't but by having a zone by having a place that I I tell myself a story of what's happening it gives me an edge for entering a trade pokes below that overnight low doesn't get new selling I can get long pokes above that overnight high doesn't get new buying I can get short or if it does get buying I can get long or if it does get selling I can get short okay so the chop zone is just the unknown zone where anything can happen and I must just be thinking on my feet and looking for more information to carry forward it's a chop zone do do do do do do do I mean textbook beautiful excess repaired the week low and now they're turning right back around for the poor high yes freedom it's forever you took a blood oath okay you're dead you can't sell your soul to the devil and then ask for it back Rui says don't you use cumulative volume delta no I did not so again I understand for a lot of traders who have been learning TA from you know certain types of people who teach markets they're taught this thing that like if you have an exact thing that you look at you'll always know what the market is going to do right if you look at if you look at VWAP footprint charts if you look at whatever right cumulative delta that you're always going to know what the market is going to do I have personally found and it might just be for me I'm not saying it doesn't work for other people but just for me personally that doesn't really help for me the only thing that really helps is simplifying myself to ask very very simple questions where is the market going and what happens when it gets there how do I measure that I measure it based on where it spends the most time and where it brings in the most volume so the idea is if they poke above yesterday's high for example let's say we chop for a little bit the market turns around and it gets above yesterday's high so my edge as a trader is not looking at any tool or anything like that my edge as a trader is looking at the market profile and asking myself what is happening once we get up there are we spending time are we bringing in volume if the answer is yes it's likely to keep going higher if the answer is no it's likely to pull back okay now am I right 100% of the time no of course not right of course not but I am right more than I'm wrong and if I can combine that with choosing to only enter trades in locations where my risk is significantly less than my potential reward then I can win as a trader over a series of trades right so everything I look at is quite simple it is just where did the market go how much time did it spend there how much volume now once I feel I have an understanding purely based on price action purely based on time and volume price time and volume right once I feel I know what the market is doing then I can look at the book map or I can look at the market internals to give me like confirmation whether I'm right or wrong but what I found is the less I look at the simpler I make my approach the easier it is to understand and I don't have to always know I can be wrong I can have no clue and that's fine as long as I only take trades when I believe I'm right and I'm taking very little risk for very large reward boy this is a very exciting morning isn't it thank you for your questions at least it's giving us something to talk about if I was sitting here trading by myself and I wasn't live streaming right now I would be so bored courtman says I'm wrong more than I'm wrong did I say that I meant I'm right more than I'm wrong but that's what I really try to help people understand this idea that I'm not right any more than I'm wrong the difference is I just don't always enter trades every time I have an opinion you know I only enter the trades when I feel very very confident that I'm right and if you add that discretion to it of not just I think the market is going to go up or I think the market is going to go down or like I am sure the market is going to go up or I'm sure it's going to go down then the odds really do work in my favor but that requires discipline because I have to see opportunities all the time and let them go because they're not quite good enough I have to wait for those A plus setups which is not easy because it requires discipline especially on a morning like this so again bookmap showing us a change in the market they came down here and they took out these stops as soon as they did they disappeared the liquidity above and below they started to reverse it back up and they started piling on that liquidity again you see that all those little red bits that's those bots trying to tell other bots yeah yeah yeah come on up here there's liquidity up here but then when we broke just now what happened that liquidity started to disappear again so the bots that were playing a game two seconds ago are done playing that game and they changed that quick they just try this try that try this try that it's so quick and they're back again to take another stab at it so we are looking for potential support right here at 50 41 we know that was a a node right here where the market brought in volume on Friday it also spent some time right so that increases the odds it'll be support moving forward and the overnight found support in there spent very little time and brought in very little volume confirming it is acting a support so we can assume that we could get a bounce there once again so once it comes down and bounces the next question we ask is what happens at the half back does it become resistance or do we pass right back through that's the downside of a chop zone you just got to wait and see Chrissie says am I using one or two tick increments he is referring to the letters that you see on the screen how much does each letter represent right now I'm in two tick increments so each letter is 50 cents near nirva sorry I know I'm saying your name wrong I'm doing my best I'm dyslexic forgive me does your course cover book map and how to read book map and how the market works so I have several different courses one is called the market profile e-course if you go to piratraders.io you will see that there in that course it's just about market profile and the two way auction process and how the market moves and how to read it and how to develop a system as a trader I have a newer course called mastery of markets in mind which includes everything including book map and I'm actually currently teaching that course but I don't have any scheduled for the future so I would just say you know keep coming back here see watch me on these Monday morning streams on the book map for free or join the brigade and kind of keep up and then whenever I'm going to teach another one of those workshops I will let you know but I don't have any scheduled at the moment so if you want to learn market profile you can take the market profile e-course piratraders.io but if you want the full course you got to wait until the next time I'm ready to teach one and I have no plans as of now however I do talk about these things all day every day in the brigade streams ten bucks a month I'm just saying do I use specific tools to draw and add comments on screen captures no I do not I don't do screen captures if a level is important to me and I want to be aware of it in the future I literally just mark it on my chart so let's say hypothetically this B period low had been weak for some reason I would just mark it on my chart and leave it there forever until the market comes back through and repairs it I don't need screen grabs because I can just open up my chart every morning and see what's there see what information is there from the previous day so choppy Nando says it's fantastic to be in a chop zone Nando I don't know what you're smoking but I want some I assume you're in like a butterfly or a you know iron condor or something and you're just trying to make money off of theta because otherwise this is bull or oring or you're a scalper who takes really quick trades brice says what are your thoughts and sourdough bread don't get me started the cliffs notes are all of you should stop eating bread from the grocery store make your own it's fun and it's significantly healthier it is time-consuming though Rue do you look at other futures to trade the ES no sir I said it once I'll say it a thousand times all I look at to trade the ES is the ES where are the buyers and the sellers I know it seems overly simple but that's it that's all I do is watch where they bring in the buyers where they bring in the sellers how much time and how much volume on the chart I'm trading and because I've done that for years and years and years and I've not looked at all these complex strategies of what about this tool and that tool and that tool and that tool and that tool when the Russell's doing this and the NQ's doing that because I don't look at all that stuff I've become an expert in understanding how the ES moves and that's all I need I just need one moment a day where I know what's happening and I can take advantage of that opportunity and I can make money that day right the more things I try to think about the harder it is to be able to make that one right decision today so I just I keep it simple simple as sweet what you're seeing on your screen is the only thing I'm looking at that's it like this is it but because that's all I look at I'm good at it Jay you got me you got a giggle out of me success okay so we made a low a good low we came back up to the half back it did not act as resistance so that increases the odds we're now heading to repair the poor high so you remember what I talked about when we had that week low at the opening price how they kept reversing and reversing and reversing and reversing at that exact level to create liquidity below they are likely doing that now with the high so you can see they're piling on the liquidity it's 46 to try to say hey hey market come up here and and and tag this level so what happens when we get there do they pile on liquidity below to try to pull the market back down or do they disappear it if they start to pile on liquidity below and this stays there they're likely to make another poor high and come back down because they're trying to get stops above now right whereas if when we get up there if it disappears like it did down here well then we'll pop right through and that should cause some short covering which might be enough to bring in some FOMO buying which might be enough to get above Friday's high which would be enough to know what's coming throughout the rest of the day getting above Friday's high would give us a chance to try to break out of this chop zone and get a bigger move but we got to take it one step at a time and assume they're going to reverse it at the poor high again to create more liquidity above so for those of you that joined the live stream late I'll just quickly walk you through my understanding of what's happening on a daily time frame I believe we are in a channel on the ES that is what we call balance the market is in balance when the market is in balance there's really only two things that can happen at the upper end of the balance either it breaks out and it turns it into support and it continues higher from there which would be if that were to happen today or it looks above and it fails coming back down towards the opposite end of balance so you could see they looked above here had to come back down looked above here came back down looked below here went back up came above here came back down came back up went down went up and now we're playing tug of war right at that high so if the market is able to get above Friday's high if the market is able to get above 50 48 that is where the market will decide which of these two things is happening is it going to spend time and bring in volume and create that momentum to the upside or is it going to look above and fail and pull back down either situation that happens is likely to lead to some real momentum a failure is likely to cause a bigger pull back down towards yesterday's towards Friday's low finding support up there is blue skies and this thing can just go but they will play tug of war they will squeeze as many traders as they can at yesterday's high so be cautious and obviously until they get there they'll squeeze as many traders as they can so we are still in a chop zone as long as we are below yesterday's high below Friday's high they can just go up and down and up and down and up and down and up down down until you lose your mind but once they get above then you might have an opportunity to either get long for continuation or on a failure to get short for a pullback with that I must say goodbye get ready to go hang out with the people currently taking the workshop and look forward to seeing you all here next Monday morning thank you to book map thank you to all of you and we'll see you next week bye