2022 ICT Mentorship Episode 29

Summary

On Monday, May 16, 2022, the presenter described a bullish intraday bias for the Nasdaq and S&P 500. He focused on a possible continuation higher, citing a Nasdaq liquidity level at 12,553.25 (relative equal highs) and a daily swing low in the S&P. He said he found no setup that met his criteria for a short trade.

He traded the S&P, not the Nasdaq, using a one-minute chart. The market had a relatively narrow, lethargic range, which he attributed to the Federal Reserve Chair’s scheduled remarks the next day. He said he entered near a fair value gap and exited at 4,022.50, after price rallied into liquidity above. He did not capture the session’s highest high.

The presenter emphasized that the recorded executions were paper/demo trades, not real-money results. He said the demonstration was intended to show how he reads price action, not to promise profitability or imply that viewers could replicate his performance.

Methodology Described

• Start with a directional bias—in this case, bullish—and avoid trades that do not fit that bias.
• Look for liquidity targets, including relative equal highs, and relevant swing lows.
• Compare correlated markets for SMT divergence: the Nasdaq made a lower low while the S&P held above its earlier low, which he interpreted as evidence of relative strength in the S&P.
• On the one-minute chart, look for a short-term market-structure shift and a retracement into a fair value gap as a potential long-entry area.
• If the ideal entry is missed, consider an entry close to the setup, while recognizing that execution may be less precise.
• Manage risk around the setup and target liquidity above. The presenter reported limited adverse movement after entry but did not provide a complete risk or position-sizing plan.

Instruments and Key Figures

• Markets: Nasdaq and S&P 500; the executed trade was in the S&P.
• Nasdaq reference level: 12,553.25, described as relative equal highs.
• Reported S&P trade prices: Entries around 3,994.50 and 3,996.25; exit at 4,022.50.
• Adverse movement: Described as roughly under two handles on one entry and under one handle on another; he also referred to seven ticks of heat.
• Economic calendar for Tuesday, May 17, 2022 (New York time):
  • 8:30 a.m.: Retail sales data.
  • 2:00 p.m.: Federal Reserve Chair speaking.

The presenter said he expected volatility around the Fed Chair’s remarks and cautioned that trading beforehand could be difficult in the quieter conditions.

Cautions and Disclosures

• The presenter explicitly said the trades shown were demo/paper trades, not real-money trades, and that paper trading cannot produce real gains or losses.
• He said he was not promising profitability and cautioned viewers against assuming they could replicate his results.
• He advised viewers to be careful and not trade the following day, warning that they could get hurt by doing so.
• He mentioned a prior claim of running a demo account up to $5 million in less than one and a half months, while clarifying that it was not real-money performance.
• No formal “not financial advice” disclaimer was stated; he did say he was not legally allowed to give trade advice.

Presenter/source: The Inner Circle Trader (ICT).