 Hello everyone testing 1-2 getting ready to get started on decision matrix All right. Welcome everybody. I'm John Slazas from Dharma Capital Trading Today we're going to go over our fact-based trading solutions talk about having a decision matrix Kind of a statistical benchmark They can always gravitate towards when things get hectic. Where do you go? You know having a standardized process is is the best way forward Before we get started I just want to point out that everything that we're going over today is Educational so nothing that we say is should be taken as Trade recommendation to do something if you are trading do recommend that you're using risk capital So that you are making the best Non-biased emotional decisions, so we have a fact-focused method So fact-focused market truths what are facts price structure as a fact, you know in crypto You don't really have a close But if you're trading a specific exchange, they're going to publish, you know the previous session high low and last Typically that's based off of UTC time So those are some hard structural facts and that's what our analytics are all based off of so our Our playbook that I'm going to go into now Every all of our algorithms here that we use are meant to find the truth I'm not necessarily supposed to be a trading system, but they're both to the idea is to find the fact foundation What is the truth? And so we're going to get into that and then we're going to go into some practical application Is this is our macro outlook and then we use book map as our microstructure And the goal of this is to really standardize your approach. So really get your Your thought process into an if-then statement if this then this And having that baseline is going to make it easier to remove any emotional biases to your trading and so We've got a Four-step approach Basically as we get into it and the first thing that we want to do and I'm going to go over on a high level every step And then we're going to go into live markets and And apply this But it just give you a kind of an overview first and so, you know As you come in and you're going to trade whatever market you're going to get involved with You know absolutely having an understanding of what events may occur, you know economic events that are on That's not where we're getting to right now we're going to get into more of the you know when you're ready to act So you have the general General sense of what's happening and now we need to identify the foundational facts and one of the the key piece is What's the state and its characteristics? So that you know, what's the context of the market? What's the structure bias? So does that context have structure and what's the bias of it? So for it's market in a trending situation What are those key structure points that are going to affect that trend? And because we're in a specific state and structure, what are the optimal and hedge strategy themes? So for trend market, it's positive trend market. We identify the structure of that trend You know an optimal strategy is going to be to participate in that trend If it's positive trend by dips, you know, it's a hedge strategy thing market break structure Or it gives us a false breakout, you know, that's going to be a hedge strategy thing. So understanding what those facts are Step two is we're going to want to identify these facts in real time So price action is performing to the characteristics of the state Is it? You know, that's that's that's a key tell, you know, if the mark if we The market is trending Higher is it performing to the expectation of that state? Is it trending higher if it's not that's a tell that something's there's something up Maybe we're in a corrective phase of that trend, you know We're going to go through our price map framework and is the market holding structure within that framework if it is That's a tell the things Characteristics can continue if it's not then there's that's a tell that something might be up And we need to consider changing our tactics and then we need to identify if what strategy themes in play So it is them is the market in an optimal theme or isn't it a hedge thing and so the the job of the trader You know every trade period is to identify, you know Is the market to perform to expectation is it holding structure and the market is going to do one of three things every day and Your job is to really identify what what phase it's in, you know If the market's performing to the expectation of the state and it's holding structure, then we want to look to participate in optimal strategy theme It's pretty straightforward You know if the market is performing to the transitional expectation of the state and is breaking structure Then we want to look to participate in the hedge strategy theme So if the market isn't participating that isn't performing to the characteristics of the market state And it's breaking that structure and the market is in a transitional phase Then we don't want to hope that that The original state is going to continue. We need to adjust our tactics And we need to participate in the head strategy thing and so if the market is it's it's either going to perform the expectation of the state Or it's going to the market's going to transition and if the market transition then everything to do with the The original state is not true and we just have to focus on the transition and if the transitional Action is breaking structure and candle structure then it's not performing to either and that's that's the tell that we're gonna have one of these No trade sideways linear Sessions, you know, so in the the quicker you pick up on are we in a hedge theme? Are we in an optimal theme? We're not they're both broke structure This is a tell that it's gonna be one of those terrible sessions and it's you know, just if that's your only market that you trade It's best to just you know, you know, if you're an options trader you can start selling some premium and look for those types of strategies Otherwise, it's your directional trader. It's gonna be tough and you really need to See if you want to put capital at risk in those situations So it's it's it's always the same. It's either an optimal theme strata hedge theme or we're in a non-event theme And then we go and we look to execute our tactics using the microstructure And we're gonna you know, we want to standardize our entry We can do that with our price map structure that we'll get into you can see we want to standardize your trade selection You know based on what the structure bias is it's gonna it's self-evident of we aware where the optimal Places to participate in the market And that leads into our size management. We want to standardize our size management And then we can optimize our trade tactics with with our metrics And so basically you get yourself into a situation where it's an if then statement if it's this then I do this And that's my story. I'm sticking to it And if everything is in alignment with statistics of what's more likely to occur, you know over the long run That's gonna work out And it's just it's not having emotional decisions. It's it's sticking with the program So let's go through this matrix today and Take a look at what we've got going on So we'll take a look at a couple markets So this is our our market grid and it quickly with through color coding identifies different states of the market so The downtrend or bear trend negative new Lowers lower highs positive trending markets. It's gonna you know identifying Markets that are making higher move lows higher move highs. That's it. That's the market expectation So we're really diving into what's the context? You could use moving averages you could use, you know, you could take a simple way to identify trend is just to you know, have a shorter term medium term and longer term moving average and Put those up and you know if the markets above them all You know, you're in in a positive trend if you if it's below more you're in a negative situation And if you're in the middle, then you're in more of a digestive It's kind of a real simplified concept of a of a fact-based indicator So if you're let's say, you know depending on your duration, let's just say you could use a One week or two week moving average a one month Average and the three-month average and those would give you some, you know kind of a good Baseline facts and this is what the truth is You know what we do is a little more in-depth in that but we we go beyond looking at a market that's in a Trending or non-trend state where we actually want to look at a market, you know, is this what type of Trend state is it is an accelerating trend? Is it a corrective trend? You know and just to give you you know more granularity to the inside of the context and You know, that's what we really get into here is just really talking about hey What what does it really mean to be in a bear trend correction? We've all traded it and we've all you know At the end of the day, you know, we recognize it and This application is providing that at the start of the session and it's letting you know that hey the foundation is this This is the foundation Doge is in a bear trend correction ether's in a neutral digestion and We've all traded neutral digestions market insurance sideways. It's a general market state The expectation is there's going to be a range that the market's going to gravitate to trade within We're not going to have good momentum There's no real bias. It's non-trending volatility can decrease You know, that's that's really just a baseline foundation. So that's your state So we're you know the first thing on the list in our decision matrix is define. What's the market state? Next thing is to identify the structure. So neutral digestion. What do we need to know? We need to know what that you know, where are those key structure points? Where are the structure points that are going to really define and say this is this is the digestive range? You know and one thing on the state, you know markets just because they're in a neutral digestion state You know, it doesn't mean they don't break out. That's kind of the hedge theme, right? That's when you know any market that's in a neutral digestion. It's a precursor to a potential break out So we have to be aware of that when the market's digesting its consolidating to make a move So part of this market state that we have to consider Is a breakout, you know markets that can sell, you know, that's that's part of this state when it when neutral states transition they break out and so we we you know plugging that that You know Context into our decision matrix is important. We need to be prepared for that But then that's the whole point of this is just having a you know If then if we're in a neutral digestive state We're going to look to fade moves until we're proven wrong and then there could be an opportunity for a potential break out And we want to make sure that we're in alignment with that And so what we do is we identify that structure we identify the upper Lid of that digestive action and the and the and the lower trough with our what we call our upside pivot downside pivots We create this critical range But what we also do is we have a sentiment bias, you know, what is the over-under number for the day? What's the the balance point? There's a lot of names for this, you know, inflection point And we call it our reversal level or our level and You know basically we're buying breaks above that price so I'm rise below it But what this does for us with the neutral digestion it identifies that hey momentum's positive above The lower trough so the market's digesting, but it has a positive bent So well, you know the expectation is that if it is going to break out. It's more like we could see a positive break out Also, if the market breaks out the downside we could see some pretty emotional energy because this is where the You know the energy the market is right now for either is it 1701? So this this helps to skew the sentiment, you know, this has given us a little skew to our state context The context is neutral, but now we're in the structure of it is positive Off the lower band so there's so if we're looking in terms of size management, and we're looking, you know, just as a general Piece here. Hey buying breaks is going to be more valuable than selling rallies Selling rallies might be a little porous You know we could push through that and just can search for that upper lid Versus on the downside if we're getting an opportunity to buy It's going to be something that might be no more hard set. We'll give that an over hard floor And so This commentary is just really just going through and defining. Hey, this is the context Well, this is how the context is skewed because of sentiment is below the market And other markets, you know, we'll have we'll have we'll be in a neutral posture, but the sentiment may be balanced You know, and this is a classic situation when the markets really coiled up So Filecoin is all really coiled up Whereas ether has more of a positive tone of neutral So it's just a it's a slight differences that make a big difference And it helps to identify really what what is that structure, you know for Bitcoin? It's different as well. So it's the same state, but it this structure is a little different And in this state you have the structure the sentiment buys it's outside this critical range So it actually creates a more of a support band Versus ether has a hard low point Versus Filecoin is is is really on the fence. It's pivotal and things are really wound up for a move and Tron is in neutral as well, but it's sentiments above the market So sentiment is going to be key and it is the most valuable point of the session if you're only going to trade if you're really risk-adverse and you just look want to look for the Where do I bet place my biggest bets? Well, I place my biggest bets at sentiment because that's where the energy in the market is That's where the big decisions are. That's where all the real money care cares about something for the session Well, all the big money is you know, their short term is quarterly outlook or me or monthly You know, you know, the only thing they care about the day Day is really the closing price and the sentiment bias. Where is sentiment potentially going to shift? That I might need to hedge or do something and so that's that's the main focus of most of the money is off of sentiment And that sentiment is going to skew the structure of the state Well, since we're in this state and we have this structure What are the optimal and hedge strategy themes? Well, you know, the op, you know, some of this is it's it's pretty obvious when you go through the truth And you see and you're talking about a market that's in neutral that has a sentiment bias below the market What's the best thing to do the best thing to do is going to be to fade momentum into that lower trough You know, this is you know, this isn't meant to be rocket science This is meant to just identifying market truths and facts and what's more likely to occur And that's what it's doing here. It's identifying. Hey, this is sentiments off the downside pivot That's what our DP is called and that's our and if the and the market's going to perform to the expectation of the state It's going to any weaknesses going to bottom out here and it's going to make a play for the the you know Search for resistance search for the upper structure The other optimal Strategy theme is going to be a cell UP reversal or a reversal strategy where the market goes through a The upper structure because sentiments positive gets excited It's not a it's not it's not going to be as hard But it's going to exhaust and it's not going to be able to hold that and it's going to fall back into neutral So we call that a reversal so it gives you a false break out to the upside So whereas in the downside we're anticipating the market to bottom out in front of the figure on the upside We're looking for that in an exhaustion Kind of in in alignment with this positive action and we get an exhaustive reversal And if the market's good and so they won't happens, you know So if everything so the market starts to transition and it's going to move away from being neutral Digestive maybe it's going to start trending. Maybe it's just an expansion of the neutral range But those tells come when we breach these parameters So if we're breaching the upper band or we're breaching the lower band those are going to be breakout signals And typically a breakout signal to the downside off sentiment would be sharper You'd expect it more of an emotional move because this is where sentiment is versus the upside and so an upside breakout The key with that would be the market needs to hold positive structure But those are our those are our themes if we're in If the marks perform an expectation, it's gonna be an optimal theme If it's starting to transition to a new state, it's gonna be a hedge theme And if they're not holding structure, then that's going to be a tell that we might be in for one of these Difficult sideways days So we've identified the state we've identified the structure and And we know which are the Optimal and hedge strategy themes and so now we're going to look at some real-time facts And we're going to see if the price action is performing to the characteristics of the state Is the is price action holding structure and is there a strategy theme in play? Let's get this set up here So these images are showing us the expectation Here's the key structure points here this the midpoint of the critical range is what we call our directional and these We have some interior what we call interior price levels. These are really for position management You know, this is the main structure and these other levels are supportive if we're getting a breakout of the critical range We're getting target here the targets. Where can it go? Upside and downside This is kind of a head fake high head fake low We call our critical range extreme negative and positive and these are validation points So if the market is transitioning from this area up to this area, it's going to have some validation That it's going to need to accomplish to do that. And so let's just take a look at what's happening in Ether so the expectation in ether is sideways Let me So here's that upside pivot and the downside pivot, which is also sentiment You know, we're talking about fact-based trading fat, you know, what's your fact foundation? you know a Good thing to look at is just, you know, what was the previous days high low? You know everyone, you know the net change of the previous days close is important But also the previous days midpoint It's a great momentum number And these you know, these are just simple straightforward facts the market is going to react off of you know So if the market's coming up to the previous days high, you should know it You know, if it's if it's trading below the previous day midpoint, you should know it So we simplify that with you know, this is something we just drawn our charts. I draw my chart You can do it, you know previous days high previous days close previous days midpoint previous days low So, you know, we have this, you know, this data and the before we start the session and this is UTC time And so the directional is a kind of a pivotal level within the critical range And so what we're doing now is is the market performing to expectation? That's that's what we're looking for, you know, this is Identify if price action is performing to the characteristics of the state Yes, it is it's digesting. It's trading sideways And it's actually trading sideways within this interior, you know, the interior consolidation extreme so that, you know This is a little bit wine, you know up until this point here the market was really kind of winding up So yes, it's it's performing to the expectations of a neutral digestive state Observe price action within the price Mac framework is it holding structure? Yes, it is holding structure It hasn't violated the neutral digestive extreme parameters Is there a strategy theme in play? So did it so our main optimal strategy theme was to buy the by the DP So we were looking to buy the market here and here this is the upper metric we call this our alert distance so this is the figure and Then this is the the boundary surrounding it and as a rule of thumb you want to keep your signal acceptance within the boundary of the metric because this is defining the structure of the state and So our optimal strategy was to buy a dip above here and the also the expectation was that the market was going to bottom out above here Well, the market didn't go to our figure and that and it doesn't always occur You know, you know, this is you know, this is called being patient. And yeah, we missed this opportunity However, if we just look at Structure and price action within structure, we definitely can get some insights. So these these opportunities are the best They're not the only ones Okay, and so they're but they're ones that they do occur. You definitely want to bet bigger So if we just look at the facts And we start the session now, we know the previous day's high point We know this is a validation point as well on the structure We know this is a pivotal number, you know classic pivot point within this bigger structure We know this is sentiment. So we're you know, we know that the market has a propensity to you know, This is any trade below here is corrective with with this expectation a rally And so if you know just using this other, you know, the previous day's price action It gave us some insight to catching this move So how do we get that insight? Well, the market comes up and challenges this area and rejects You know one thing what we that we know it's part of this Optimal strategy theme and if is you get in you know, we study more of what neutral digestion is what the critical range is You know a classic Digestive scenario is the market tops out here and bottoms out here that you know, it's a coiling So is this basically this range is contract. It tells you the range is contracting And that'll happen. And so here we have the market goes below the previous day's close Trades below the direction, which is a sign of weakness. You get this price action that Validates that this is a good structure point and Then the market comes down to the previous day's midpoint here again, we're getting a little, you know some a little bit of reaction So, you know, if you're really trading shorter term, you know, this structure is giving you insight to Manage your opportunities, you know, this kind of validation that the market is concerned, you know, it's using the previous day's Price points as you know, it's reaction points, you know The fact that this midpoint is is in the middle. There's you know, no structure associated with it This is where support and resistance Technical analysis fails You know Everyone's coming in and looking at all the market bottom here. It's gonna base here But it's not happening at a structure point and the structure point is is what the big money is looking at They don't you know, when when support resistance works It works because it's aligned with structure and when it doesn't work. It's because it's not aligned with structure So you do have this price action Occurring around this midpoint, but it's not in alignment with any larger term structure And this is just the daily Structure there's weekly structure monthly structure and so So then you have a retest of the close we have a failure here and Then we get a failure here of this metric We're looking and we are definitely buying of this break, but it doesn't give it to us And so the fact that we went below here and then we traded back above it here and we based here This is a bit of a tell of that reversal. So instead of getting that, you know An exhaustive breakdown to here the market has given us a failure Back above it's stabilizing and this is a reversal and then you get a validation where you move back above this midpoint And so and then you know, then you get the retest of the close You get there, you know, it presses the lower end of this metric boundary So really in stabilizing here and then again, you're getting that transitional signal above The previous close and then you get a breakout above this metric So this is all, you know, this is just insight into Identity observing price action within market structure And so now we're back at the previous days high, you know, so is a strategy theme in play Sort of we're sort of in a buy by DP fade theme Because this is corrective and we're in this theme. So that's our story and we're sticking to it in the market And we as we if we're coming into the market right now This is where that signal occurred Here it was completely validated This price action up through here is positive Where should this market go? It should go here What does it need to do? It needs to base above 1750 It needs to stay trading above this previous day high point or is this just another reversal where it's just the market's gonna fall back into a non-event day You know that we do have some some news coming out So we've got Pull that up So tomorrow we've got Powell testifying so that's coming around Ten eastern standard so maybe the markets is done for the day and it's just gonna wait for that could be Right now the tells 1750 we can't if we can't base above here It's over and that's that's in alignment with our decision matrix, you know, we've identified Is there a theme in play? Yeah, there there is a we're somewhat in the by DP fade You know is the mark perform the expectation of the state and holding structure and look to participate in the optimal strategy theme Okay, well the market already made its move there and we could you know if we're going to participate in it we could catch the very end of it and We don't have the market is holding within so there's no hedge theme in play right now and So, you know is that is them is that are we going to potentially be in a no-trade situation? It seems what we're we might be gearing up for so if the market can't hold above 1750, you know, it could easily just Break all the way back down here if it did that that'd be a big buy You know, you just have an event move here with the expectation markets going nowhere The market starts to stabilize above here then we can look for a move up to this level so now we can take a look at The microstructure and you had see what kind of insight we get from the order book and our micro events And so, you know, if you only have So now all the tactics that you've learned and that you used to trade You now you have this structure foundation behind you to help you to you know to help you make those decisions You know you have the fact foundation So whatever you you know, whatever you're using and however you use your order book and order flow Analytics you want to have that macro picture It just it's a game-changer Because it really gives you that clarity Then you know what to do and so, you know just knowing that we are you know the market You've got alignment with the previous day's high point and this structure value. They should point at 1750 And you know currently that you know, we had we had some excitement here and Look at all these, you know, I like to watch just you know what you know clip sizes coming through to get a sense of You know momentum And here we have the order book building up a little bit off the lower metric and so This can be a tell of exhaustion and we especially we break structure here You take out this low we come back when we start to build negative, you know price action They could set up a play for a move back down to the previous day's close. It's not the midpoint Again market is the market reformed expectation. It's going sideways so today was a day that With the expectation was more likely to be not very interesting You know sticking with the you know looking for alignment like with the previous days high point with structure For opportunity and and using your tactics with the order book You know, that's those are the kinds of alignment and then that you you want to look for and you want to use structure To give you insight to duration and to your targets. Let's take a look at Bitcoin real quick So we know that Bitcoin is in a similar Market states and neutral digestion but sentiments below the market at the Is well, but this one is at the CRX-minus So it's just it's just a little different to update there So in Bitcoin we had the market actually tested the upside pivot. So it tested that metric So that was performing to expectation Then it broke down and we knew that the bigger bigger structural Support is down way below the market You know this kind of area and we had our previous days low point, you know, so this hot kind of zone was the big buy area this is we you know where your big size is and You know here you had a test of this area the market starts to go lower it's kind of stair-stepping you could look at the price map structure as a ladder and This is what you you know When you're observing price action within structure when you get a failure So we get this failure below this pivotal point below its metric below the previous day's midpoint This these situations spark these situations false failures So we what in an understanding the context of What's happening where the market is, you know, this market is the neutral It gives you a negative signal. It should rotate lower and it doesn't And so when you get this signal and the market reverses and gets back above the previous day's close It gives you an insight that the market's gonna, you know make a retest of this upside pivot And why would it go? Why would the expectation be that it would go higher because the market Told us here. It went already went above the previous day's high point. So it already took that out so in a neutral digestion If the the market see they're gonna break out or it's gonna search or it's gonna search for that a new upper band you know a new upper new upper lid for its new to digestion and in this one of the optimal themes because sentiment was below the down outside the critical range was a Cell up fade. So instead of what looking for the reversal It was a hard fade and the hedge theme is a buy up break out So the the cell fade paid out we call this a The price distance between two major price map levels is a 1 a PMT. So that's where it kind of your minimum target And Since sentiments below the market, it's so this is a sell against sentiment. So it's corrective And so it so that theme paid out then when the market then let's put the Validation points on so the market's still working lower now it the market tells us it wants to go further lower but when it does this it breaks structure of that fade and Absolutely in this here It can it negates the fade because if the market was going to roll over completely it shouldn't have gotten back above this price Definitely now it's telling us there's there's an issue with it. And then here we're getting a Transitional buy up breakout strategy theme. So now as we're observing price action within market structure in the context of the state It's no Bitcoin is no longer in a digestive mode. It's in the hedge theme. So it's in transition So what's it transitioning into? We don't know we won't know you know on a daily basis What's the structure going to be tomorrow? It might be just an expansion of the range. It we could be transitioning into a positive Trend situation or it just could be a big positive shift into neutral, you know a bigger neutral shift But what we do know based on structure is since the market broke out of the upside pivot and It validated above the critical range positive that it should at least come up to this point That's our minimum one the PMD move Since it's a breakout of the critical range What do we else do we know we know that the Target objective is two APMD's So that would bring us up to twenty eight one forty. So based on the facts the markets made a new New high for the day We've broken out of our we're note. We're definitely are not in consolidation of a neutral digestion We're in a hedge strategy theme And so we were looking to participate to get on on board with that hedge strategy theme, which is a breakout The market attained the its first objective. So it already paid out won't a full APMD If this rally is going to continue any pullback should base above here We shouldn't trade back below twenty seven four hundred And if it's and if it's really aggressive, it's going to maintain structure Above the lower metric here. So it's going to start. You'll you'll see it potentially base above twenty seven six twenty Because that would be an acceleration Also, if we if the market does continue to just go linear here Up to this area. This would be an exhaustive Uh potential situation So you definitely if you're along the market having resting orders in this zone So if you do get one of those big spikes, uh, you're going to anticipate it because that's the the natural Breakout target of a critical range is a two APMD move So this is a finance consolidated order book with, uh, bybit and okx and this is the, uh, usd coinbase kraken bitstamp bitfinex book and You know You can see there is some liquidity starting to build up here at the, um at the upper target so when you, you know as you in most of you are proficient in the In the moment in the microstructure and so this is basically your your Macrostructure statistical baseline, you know, this is your benchmark, you know as you're making decision You know, this is giving you the birds eye view out of the forest and you're you're in the trenches And what this is going to allow you to do is it's going to help to you to standardize your entry So when you're looking for those your signals or your opportunities, is it valid? What's it worth? You know, so it's going to help you to standardize your trade selection So when you're in this specific state and structure, this is where I really want to participate Here's some other and then being able to identify really understanding what those themes are of You know, and it's this structure bias. Here's where I can jump on a situation You can standardize in your size management is really paramount So knowing when to bet big when to bet small when not to bet is huge That's the all the difference in the world of longevity and trading And then using those metric boundaries to Yeah, to really Dial into that microstructure and when the market's not in those metric boundaries to understand That it the it's hard to really define the risk when you're outside the the structure of the market And you know, it's more expensive. It's riskier. That's where all the algos really have a lot of sway Because there's no funds that are really looking to participate the funds are looking to participate We're in structure alignment And when markets aren't in alignment, it's just you know, free game for Predatory algos to just pick you off and just to squeeze you and go nowhere So the the solution Is fact focus Anytime you question You know where you're at or what you want to do, you know dial it back to the facts You know if you're you know We've got a great tool for that Otherwise, you know, you want to you know, at least understanding. Where's the market In relationship to that's in the previous day structure The simple fact is going to be is a real powerful baseline To you know, it is when you're making your decisions If you're if the market's trained below the yesterday's low It's trained below yesterday's low if you're buying the market. You need to be careful You're going against the grain You're going against what's more likely to occur And you need to know that So if you have any more questions, you can feel free to email me directly You can also uh I do Post on twitter often On bitcoin and other crypto markets We have a virtual trade room. We're getting going on options trading And you can come to the dharma capital dot trade website and Take a free trial on our playbook application and our chart overlay integrations And one of those integrations is with bookmap where Our structure Is going to come up You'll write on the heat map. So you'll have that Right in your eyeball Well, thank you for your time today I look forward to speaking with you and working with you Enjoy your day Cheers