 Want to hear me, okay? Justine one two. All right, so last week we went over market-state awareness, and we're gonna start to get into specific states and Talk about Characteristics and just kind of you know improving your markets data awareness so you can align your tactics with you know what's true and We'll use some of our Applications that we have that'll you know guide you into this Kind of a standardized way to get prepared for the day and search out conditions that really Work best for the way you like to trade. That's what it's all about So we're going to talk a little bit about strategy strategy based trading So before we get into it just want to go through a disclaimer You know basically everything that we're going over is for educational purposes to help you improve your trading If you are trading you definitely want to be using risk capital and not trade with money that you Need and you can afford to lose that money By doing that You'll have better clarity, and you'll make sound decisions You won't you won't be you know the markets are designed to shake people out with weak hands, and so You know you definitely want to get out based on your strategy not based on your emotion, so Using risk capital it makes it easier to do that a little background on me. I've been involved in the markets for over 35 years from Chicago Basically my first job was on the floor of the mercantile exchange. I worked for local pit traders individuals Counting their cards putting levels together, and that's really how I started my business is just Selling numbers on trading cards for traders buying sell off of and kind of grew into the From the Merc to also at the board of trade and the CBOE and you know basically established Js services, which is a analytical research company, and I've been you know kind of supporting traders with that ever since got involved in crypto in 2013 and Pretty much full-time in around 2016-2017 when ether came on the scene Formed Dharma capital with my brother, and then I started Dharma capital trading as a proprietary firm this year and I'm all about empowering traders through Self-realization and quantitative methods, so you know I believe that you know People can beat machines Based on their intuitive function, so having machine you know machine assisted over a complete algo You know a person can drive that better When they are performing at their peak and people perform at their peak performance when they are in flow and to get in flow you need to have a you know real good statistical baseline real objective fact baseline and That's when your body really is able to engage when they know that they've got the you know real truth And they're not it's not you know forcing things based on you know what your ego thinks it should do and your subjective opinion, so That's what the analytics that we have are all about Providing you with a statistical baseline And we call this fact-based trading You know basically making decisions based off objective data and analysis rather than subjective emotions or opinion And so we hear some of our fact-based trading tools that we'll cover today a little bit our playbook and our price map Which we have different integrations So we're going over you know the markets are complex. There's lots of layers And you know it's not easy You know if it was everyone would be doing it and everyone would be successful You know there's a lot of people that go out there and promote that it's easy to trade and make it You know millions of dollars on in you know in an afternoon But it's not it's very difficult It's challenging and It's all about improving your awareness So that you can trade effectively and the the baseline for you know Is your you know, you know, what is the baseline? Where do you start? Well, you start with the market-state and Then that really refers to the prevailing condition and the dynamics in the trading environment at any given time now this is the baseline and Market-state Factors encompass, you know, you know just a bias is it positive can underlying condition negative Underline sentiment that's influencing prices What's you know the liquidity is? part of the state Certain market states are going to have better liquidity and that you know, how do you X you know? That which is you know determines your execution You know you're getting in and out of a trade is it then can you get in on the bid offer? What the volatility expectations are you know as the expectations of the condition going to be volatile or stagnant You know always you know, we're looking to align our trading tactics with these condit You know these these factors, you know and is that you know, is there a trend or is it a non-trend? You know, so these are kind of you know the general factors of a market-state Here's a quote that I like from Sun Tzu. I think this really you know gives a lot of clarity to To what market-state's all about you know water shapes its course according to the nature of the ground over which it flows The soldier works out of his victory in relation to to the foe whom he's facing So As we you know, we're going we're climbing that mountain. We're fighting that battle in the market You know, what is that context? You know, what is the nature of the ground? That we're dealing with and then based on that we adjust our tactics And so that's why the market-state is that you know is that base foundation you know, this is this is the And the barometer that really determines How you approach the market every day how you tweak your tactics. You can't take a tactic And just apply it religiously You know, it's good for your discipline. It's great that you know, you've got this thing wired down But you have to it needs to be modified or even turned off in some situations in certain contexts certain market-states And so this is what you know having that awareness is all about And this leads into you know, what I call strategy-based trading Where you know, you're Trading specific states instead of specific markets or sectors, you know instead of just I just trade bitcoin or I just trade the s&p You know You may have a tactic that trades negative trends You know and and so and searching out those States for your tactics And so it doesn't really matter, you know, what market you're in You know, you need to know the the fundamentals you need to know You know, if there's any economic releases that are coming out related to that market But basically you're focused on the stake in the context because you you're you're you're engaged in that environment And the more you get Engaged in an environment and you really understand it, you know The easier it is to see that your tactics are working or not working because you're always in the same environment And so it you know a strategy-based trading approach you're searching out specific conditions specific market states In addition to the structure of those states, which is you know kind of gets into Other layers and we'll touch on that briefly, but this this presentation is really just to go over Market states and specifically a bear trend market state So, you know analyzing states instead specific sectors aligning tactics with the current conditions For consistent trading. You're always in that same context. So it makes it easier You know facilitates your tactic assessment adjustment You know, you you know when your tactics are working or when they're not working because you know, you know You know how they should behave in that condition And so the you know the goal of this is to you know, really improve your long-term results improve consistency And you know, especially as you're starting out trading It's um, you know instead of just jumping into that, you know, everyone wants to trade the S&P 500 And it's one of the most difficult markets in the world because most all the smartest traders in the world are trading that market You know, you come into crypto. You're you know, definitely, you know, liquidity is a factor in the crypto markets It's an up-and-coming market um But you know having you know identifying Who you are just self-awareness and we have A personality profile that we can go through and feel free to email us and we'll direct you to that that it gives you better awareness Up to who you are and what you know, where your core strengths lie and and where do you want to align them? And some you know, a lot of times those core strengths align with specific states But that's not what we're getting into today. We're getting into, you know, market state cornerstone of strategy based trading That's what it is. You know, this is the foundation The standardized tactics based on likely price behaviors fostering objective insights into the trading environment You know having that base context You know statistical baseline objective baseline, what's your foundation for your tactics? You know awareness, you know Improving awareness, you know, lying your tactics with the current state conditions preventing decisions to be clouded by personal opinions And facilitating realistic expectations You know, this is a huge factor that you know having an objective baseline. It's just gives you that fact check You know understanding that you're you know, you're you've got this bias and and it needs to be in alignment You need to you know, no matter what you get anchored on something from the news or from a friend Or from some subjective technical analysis that you did And you get stuck on it And it's it's having it and it's something objective Hey, when that when you're those subjective opinions are in alignment with the truth market facts You know, that's great. That's you know, when you want to go big, you know, when they're not then, you know, it's it's a Something to dial back or not or not execute and so This is real power, you know for discretionary traders And it really improves the ability to get in the flow and trade intuitively you know Understanding what the baseline condition is you can it makes it easier to anticipate events And act more instinctively You know with clear, you know, clear real-time understanding of the market state Now when you really own the market state, you really own that condition You know in real time you you you're able to anticipate what the market is doing because you know what it should do And so as long as the market's performing to the state the context of that state You shouldn't there's nothing to think otherwise And you just clue it into it And you and you get into the zone and you're in flow And then you're using your natural tactics of you know observing price behavior and you know the microstructure of the market and order flow And then understanding where the alignment is so when you're really when you want to execute But it's what it's all about really getting to the That awareness of what the what's more likely to occur So you can anticipate and you're not reacting to to situations So this is you know, this is the strategy baseline You know another quote from Sun Tzu, you know strategy without tactics is the slowest route to victory tactics without strategies The noise before defeat Most traders feel you know their technical tools or their strategies, but they're really tactics And they really need that foundation and market state is that foundation So you know your tactics are setups really Those are you know and and like you know the other quote You know when you're what's the ground that we're dealing with what tactics are going to be best for this condition That's what you need to organize your tactics in Around what the strategy foundation is because that's what that's where the game's being played The game's being played on top of the strategy foundation So a bare trend, you know trend negative situation downtrend We're going to go into today is part of the general market state types. So there's You know, these are the you know, generally accepted, you know trend types. We've all traded these You know general states positive trends negative trends Non-trendy markets pivotal markets, you know when markets at a extreme positive or negative In other presentations, I'll get into more what I call signature states So instead of just let's say a negative trendy market and a down bear trend You know, maybe it's a bear trend acceleration where the the trend is actually accelerating to the downside So that you're going to tweak your negative tactics a little bit for more You know aggressive action because the market's in an accelerated posture And versus a bear trend that's in more of a bear trend digestion. So it's more it's trending lower But it's it's it's begrudgingly going lower. It's you know, it's going sideways lower Yeah, so then you're going to have to tweak your tactics for that condition You know, or it's a bear trend correction where, you know, you're actually in a corrective Stage of a bear trend. So, you know, bear markets don't go linear down bear trends have corrective positive shifts And so, you know, those are what we call six signature states So for now, we're that we're focusing on general market states And so we can break down You know the The market state into, you know You know one identifying the condition, you know, what is that? What's the expectation? So this, you know, this Image is really this is an image of what a bear trend looks like This is what the expectation of price action. That's your expectation. That's your playing field And then what type of attributes are associated with that? So again, it's really owning that environment You know, this is the baseline And what is it? What is a bear trend? Well, bear trend market stays identified by as a market that continues to make lower move lows lower move highs This is known as negative price structure That's the definition of a bear trend If the market is not doing that or if you come into the market And it's been identified as a bear trend market state And the market stops making lower move lows lower move highs Then If that definition is not true of the current price action, then the market's no longer going to bear a trend and you can't hope That it's going to go lower if you're short So is the market performing to the expectation of the state? What's the definition of that state? Negative trending prices You know, if the market continues to old structure, then You know, lower lower lower high price action should be Anticipated to persist. So if the market is trending lower It's not a time to pick bottoms It's not a time to You know think, you know, you have a subjective opinion that this thing's overdone You know, my oscillator is oversold You will who cares? You know, the market's trending oscillators don't work in in the trending market. It's going to give you a false signal It's going to sit there for a while and it's going to squeeze you for who knows how how far and stay oversold And you know either way that you know those types of indicators are lagging and you you want to be Focused on what you can anticipate and what you can and if the market is performing to expectation Then it should just be anticipated to persist and it and it's like that's your story and you're sticking to it And until that's not true then the trends in the bear trends enforce Because we don't have no idea how long it's going to last we get some ideas But the market is going to tell us what it wants to do And so if you're on a boat bear trend, it doesn't mean there cannot be positive corrective price action But what the expectation is is that that you know that it's going to find resistance below the prior move high And maintain that negative bear trend state. So it's going to maintain that negative structure And so, you know Anticipating that exhaust again, that's the key right anticipate Because we we get edged by anticipating we we lose edge if we're reacting If we're reacting to situations where it's too late We're going to make money when we anticipate So this is an image from our playbook that identifies this market state And you know bear, you know, it's it's literally a book That goes through and identifies, you know, what the conditions are and what the expectations are and those don't change Bear trend is a bear trend There are any markets that's in the bear trend is going to have this expectation You know persistent lower lows and lower highs sustained negative structure And the high inflection points indicate the potential exhaustion of that positive price push You know on on The attributes You know, it's going to have good momentum The bias is we're going to have a negative bias in this state Volatility expected to increase And we're in a trend negative type You know, you may have an automated system or you know, just you know Different characteristics you look for your tactics and you know, the these are groupings as well You know, not just basically that based on the state but based on Market conditions where volatility is expected to rise This, you know, bear trend goes into that bucket You know market market states that have a negative bias, you know Bear trend goes into that bucket. I have tactics that do well and you know, negative, you know momentum states I have moment. I have great momentum tactics. Okay. Well, then the bear trend is going to be one of those States that are going to be advantageous For your tactic again, it's just about aligning, you know Aligning your trading with the condition So if we're in a bear trend state What are some strategies we want to implement Trend following tactics simple moving average We're going to get into some live markets in a moment Managing risk at the first and second structure breaking points Why because we're you know, we're going to monitor price action if the market should be making lower Lowes lower highs if it's not there's a problem And so we need to be prepared for those potential shifts Because when the market a bear trend You know break structure You know it's it's going to break structure and you know either a kind of a violent shift a big squeeze Lord's going to go sideways and so that's what That's what we look to identify when we're identifying the the market state is what are the tells that this market is working You know The general market trend states are pretty straightforward bear trend lower move lows lower move highs. That's it As long as it continues to do this and hold structure, we should expect it to continue It doesn't mean there can't be these corrective pullbacks But those that price action is expected to exhaust below the high inflection point that will maintain structure And if we do get a break in that structure, what's more likely to occur that we downshift to a neutral rather than a positive transition So, you know those structure breaks are when we get a real when volatility really gets hit You know those like the those are really the initiation points for a turn in ball Because if you get the turn and then it's and then the expectation it's going to trend sideways You know a lot of times in a bear trend the market, you know if it's been trending lower And it just kind of it's sitting there near the end of the day You know a lot of times near the end of the session we get this a corrective squeeze into the close You know typically what'll happen is the market, you know, you know, it's trending lower But then just kind of stalls out you get the big squeeze into the close And then the market closes and then the next period starts and we start to trend lower So, you know crypto really doesn't have closes, but UTC You know midnight is basically industry accepted kind of start of the new day And so You know that you know the world does still work on You know margin requirements and so you know either on it's going to follow patterns of traditional finance Or it's going to use the UTC close Either way you've got you know, what'll happen near the end of that settlement period Is you just get that big squeeze play of people that have been short need to get out And then a lot of times that that's that's kind of the high peak area for the bear trend So let's take a look at kind of live market conditions right now in the application and Let me pull up the playbook and we'll take a look at What's happening here? So this is our application our market grid. I've got crypto loaded up but we cover future stocks and ETFs as well And this is a finance grid We also you know, we cover Kraken and Coinbase and Derabit Blockfills And we're looking at the perpetual right now So again, when we talk about market states, we're able to quickly identify through our color coding You know market states that that our tactics are going to work well in you know, so Bitcoins in a bear trend, which a lot of that crypto is The ether bitcoin spread. However is in in a neutral posture ICP is in a a neutral negative shift Makers in a bull trend acceleration You know ocean is pivotal right now. So, you know, what's the market state? We're work, you know, we're focused on bear trend right now Keep it simple general market state type and so If we look at bitcoin And what I've done here Another simple Simple tool to use Showing two sessions here So this is the previous days high previous days low previous days closed closed based on 12am UTC time and then the midpoint of that range And so I've plotted it on today's session as a simple tool we actually have Price structure that identifies the structure of the state. So I'm going to show a little bit of that But Here's the start of the session and what we're looking for is what's the expectation? Well, the expectation is that the market is going to trend lower. It's going to make lower highs lower lows so we like to look at time phases And the you know the opening phase for For crypto is like the first four hours of trading And after that time period The market will typically make a decision So let me just draw that in here So the application that I'm using right now is called sierra charts We do have an integration with this application And if you want to do Get some of these tools you can set you up So So here we have, you know, just what's the expectation backdrop? What's you know the ground that we're fighting this war on with the market is negative negative trending We know, you know, so if we're able to identify what's the previous session high You know just Just this is called time frame structure. So we're not looking at this price action structure So just looking at you know the previous period keeping it super simple here What's the expectation expectation the market's going to make lower highs And it's going to make lower lows So as the market comes into the opening range here It identifies it in the first four hours of trading. So basically this range here We know that we've got the previous days high. We also have the previous days closed. So this is the net change So net change is a big number. So what's the expectation of the bear trend should be a net change would be negative So, you know, if it's if it's above the net change, what what what does that mean for a bear trend? That means we're in a corrective position I know these are simple concepts But they're this is something that most people forget about and they focus on other things that are irrelevant And so really just owning the the foundation the basics is key And this is where you really start to plug into your intuitive function when everything starts to click by getting into the baseline and so baseline Understanding the backdrop is bear trend Understanding where the previous high of that period is Understanding the close because that's the net change And so when we have the opening line again coming to alignment with our close That's giving us insight that the market is focused on that Net change for the day is a valuable point We know that it on the opening range the market is trying to search higher for that peak We know that the previous peak was here 25,880 And the market couldn't get there Oh, you know, let me uh So i'm just adding this uh Parameter just to show Kind of what that you know this The beginning of trading, you know the markets making you know kind of just making some decisions And it forms this opening range And so we have that formed here within this period and then this kind of gives it This will give us some insight and affect the market through the uh through the balance of the period So after at the end of the opening as the market creates this opening range Using the base the base of the low of that opening range as the previous market close all of a sudden you have this interesting alignment and What the expectation here is that the markets at least going to come down and test the midpoint of the previous day's range if not the low point And so that so when we have the market go negative with the expectation that we're in a negative trend The market's starting to perform to expectation of the state So this this is where You get confidence And so when you're getting these You know kind of pullbacks here The your expectation is the market's trending lower when you're getting you know when the market moves Attains this target. Yeah, your expectations. You're going to see some kind of bounce Some kind of reaction And then the market consolidates within this range and you know that this range is key But you also know the backdrop of this is bare trend And so when you have a situation like this and you market you get this squeeze here You're not fearful that the market, you know, if you're short you're not fearful because you know the market's coming into structure And you know that that's what the bear trends do they have a sharp move into structure So at this point you're getting more confidence that this thing could you know, we haven't attained We haven't pressed this low And in bear trends like to make new lows And so now you've got you know, so you know here you've got awareness and confidence And then at this point the market is made a new low Validating this negative trend And the market is holding negative structure Holding negative structure and you get this release And now what's it doing? Well, it's breaking price structure So it's not performing like a bear trend anymore it was And failed And then mainly changed gears So if we look at you know, so so what it so now we're in a situation where The market spoke structure And I like to look at let's go To a shorter time frame here There we go So here's the start of the day So if we're looking at negative, you know price structure You know, we have the opening range is determined it breaks out the opening range. That's negative Holds below the previous days close test the midpoint And we get a failure we get our squeeze into here, which is classic corrective action But we're holding negative price structure Here's our low we make a new low and make a new high Make a new low continue You know this pullback does not take out this high And then here we make a new low So if we're looking at price structure, this is what we call our first structure break and this is our second structure break Right I mean high pull back low pull back low. So this is our first structure break second structure break So this is this is great alignment. So we have a at this point We could get in I guess we could take a let's could actually take a look at book map here So when you really get into the microstructure or where you know, where where you're getting that break in momentum, right? So you had this failure here that produced this so the market really should stay You know below this structure plus this is the previous day's low point So if this market is really going to you know, accelerate to the downside on a bear trend It's going to hold negative structure. That's the whole point Of that what we're talking about here Yeah, getting an alignment. What's the expectation expectation the market's going to maintain negative structure And so when it fails from the previous day's low, it should continue lower And here's where we can So here's that failure And then the market starts to break structure and then it and then as it moves above the v-wap here At 25559 so at these levels here the market's trading it came back to the low point It broke lower and at this point here the market's telling you that there's a problem with the negative trend Because it's not performed to expectation It should just go that should have been the squeeze and it should just go and make a new loan It doesn't so this tells you the bear trends over It's telling you that the Well at the moment it's telling us that the bear trends we're in for more of sideways action Because we're not performing to that negative structure that it broke So that that's a tell that the market's going to go sideways. So this is a volatility sell vol right now basically It's The validation that we're going higher And we've and we've changed that's going to that would occur here If we get above the previous session midpoint and we take out this price structure point here because that's the initial failure point So we actually, you know, what we part of our analytics that we offer Is we not only offer the condition But we offer or this, you know, the state but we offer the structure of that state So what the structure does is this this Defines The turning points in the bigger state condition so where the and at these inflection points that define The structure of the state This is where the most liquidity is. This is where the best opportunities are So we call this our Green level is what we call our sentiment bias and currently That's above the market So this tell you above this above this price for positive below this price for negative So it's in alignment with the bear trend then We're going to identify the lower structure breaking point of this trend context of the bear trend state So what the structure is doing it's telling us that, you know, if this market is, you know, what's the what is the Expected reaction point for the next impulse. So when we make a new a new move lower What's the expectation? Well, the expectations come come come down to what we call our downside pivot And so today that's 25 371 So again, we started out just looking at, you know, general time frame structure To let me change this to a five-minute chart, you know, we talked about markets being complicated, right? so there's lots of layers and so You started out with just looking at, you know, what's the previous day's high low? That's important information. What's the opening range? That's important information What, you know, and be even before that, what's the context the backdrop? It's bear trend and now we're you know What is the structure of that bear trend? And so when we have sentiment above the market in a bear trend, that's negative We could have had a potentially a corrective rally into here to sell that didn't give it to us They traded back below what we call our directional, which was in alignment with um previous day's close And the opening range low point so that gave us more More credibility to this structure here. So more confidence that it's negative to sell Where can it go? It can go down to the downside pivot And that's where the market's going to make decision. Are we ready to really extend lower or is this just a you know The here's you had your flush and now you're you're pulling back here And this is the towel that the markets probably is going to more likely going to go sideways for the balance of the trade period And then this structure will reset for the next trade period We also have some minor structure that helps to you know manage your trade And this had good alignment here with the previous day's low point And then here's the validation into the downside pivot and then we break structure We break not only price structure, but we break market structure and so This is you know, what we've gone over so far and when and working with the playbook This is consider this kind of your macro structure You know, well, here's the macro picture bear trend sentiment above the market Structure below the market at the downside pivot selling relays against sentiment And then what's happening What's happening with the order flow? You know today, there's a you know, this is a kind of a classic You know classic excitement where you're getting, you know the market the you know, the where's the real sell opportunity? Well, the real selling opportunity is up here Is at this point You know not a lot of interest coming into major structure And then here's the market fails back down Below this structure. So here's our integration with book map And you have that alignment with the v-wap. So this is you know, I love this I love this alignment when you have Structures aligned with the v-wap. And so as the market's giving you all this noise and headaches One, you know, how big the structure is two, you're getting the failure here. Just keeping it super simple You don't need to complicate this stuff And that gives you your confidence the market's going lower and then you get this kind of action Markets holding below the v-wap, which is nice. And then you have this Failure here from our metric and the previous day's low point You get this intensity of trade Into support You know into this major structure So if this was occurring below here, that's a little different story than occurring into it. So these are so There's people that don't have awareness of the structure points are puking out into a figure This is what you're looking for for opportunities And if you're getting that happening through here Especially if the market then holds structure, that's a tell that we've had, you know, this market's really in trouble But right now it's more of a digestive, you know, this the expectation is more for now digestive because we broke structure in a bear trend And you know, what's what's more likely is that the market is going to produce a neutral shift You know rather than a positive transition. So again, what's more likely to occur, you know, that's why selling, you know We're starting to get towards, you know midway through the session, but so your expectation of volatility is going to decrease And it's more likely the market's not going to be able to overcome this directional area But that's what it's all about, you know, basically having a you know, statistical foundation of state and defining the context using your other, you know, other tools like Just like under no, you know, knowing the facts associated with time frame structure with previous high previous low understanding, you know, in the opening for momentum if you're If you're if we're on your team, then you're having you have this information as well, not only the state, but you've got the structure of the state And this so this is real power And you have your foundation and then here and then you go into the microstructure And this is where the action is and this gives you the insight of what's occurring here This gives you more insight that this is a puke people are puking out And you know, and so they push it to the upside and what down side and what happens then they're going to push it to The upside and now you're getting these same people that just sold it here are starting to puke out up here And they're doing the same opposite thing. They're coming right into the good structure and they're doing that So we're going to go through different market states in difference in, you know, the coming sessions, but you know, the key thing Is to, you know, take notes on states A line, you know, go through your tactics and what states work well with those attributes of the different states You know, identify those characteristics You know, when you recognize and understand the persistent patterns and structures of a bear trend market, you know, that's giving you clarity And it's a trending market. So these are trend following tactics And trends typically, you know, when they do move, they go farther than you think they're going to go So let the market tell you when Let it pay you and be aware when market breaks structure You know, look how quickly the market shifted today in bitcoin on the downside You know, if you didn't if you didn't have the price map You know, you could have given back a lot of dough But understanding that the market's coming into structure is a whole different game. So you're aware. You're ready. You're anticipating There could be a reaction here. This might be all I get on the downside today So, you know, adjusting your risk for that So I encourage everyone to come to jservices.io And sign up for a trial of our playbook You can also contact me directly at js at jservices.com And I can answer any questions And we'll get you set up with if you're interested on more self-awareness You'll reach out to me and I will kind of direct you to the personality profile assessment that we have Then that's really where it starts start with your own self-awareness then market state awareness We build from there So thanks for joining us Appreciate your time and look forward to seeing you next time Enjoy your day. Cheers