Get Your Trading Done Early With the Morning Liquidity Imbalance Move! transcript

hey what's up y'all welcome back to the channel my name is Andrew with the options millionaire community and today I'm going to be showing you a tool you can use to get on an early trade that can either help you catch a nice liquidity move and or get you into a trend early now this is mainly going to be talking to our day Traders and scalpers this won't really be centered too much around swing trading but it will give you a good premise into understanding how the market moves on liquidity if you don't know I'm a vpa Trader which stands for volume price analysis which is heavily influenced by woff Theory by Jesse Livermore and course also taught by Anna coing who wrote the book complete guide to volume price analysis now all of these teachers centered on one particular thing is that everything moves on liquidity not a line not an RSI not a widget not an indicator but simple liquidity where are the buyers and where are the sellers this Theory exploits that I'm going to show you how to do it it's a very early in the day move to help you get your trade on get your profit and then go about your day the theory we're going to be talking about today is what I call the morning imbalance move I apologize I don't have a big fancy name for it but that's what I call it the reason why I call it the imbalanced move is because it exploits the nature of the market to transition from balanced into imbalanced I know that sounds like a bunch of fancy jargon but in reality it's just a wait for a market to reverse and head back to a particular area where it started where the imbalance was created because in order for the market to Trend One Direction there has to be an imbalance created because the one side of the book is controlling it more so than the other so the first rule I have for this move is I can only trade this move between 945 Eastern and 10:15 Eastern which looks like this visualized and obviously these times are in Central Time Zone because that's where I live so what I'm looking for here is for the market to open and skew towards one side of the book and then sometime during this time frame it Rejects and goes back the other way in this case it bounces and heads back to either one of two Targets one the morning open or two the morning high in this case the market opened at 2,121 so as we see the Market opens here at 9:30 Eastern 8:30 Central and Trends down aggressively and then finally we B and head back up your entry is going to be somewhere in the first three candles depending on how aggressive you want to play now me being a vpa Trader which is volume price analysis I am looking for volume to tell me when we've hit a bottom in this case we got that volume right here at the 10:00 candle the big volume comes in to tells me that the buyers have stepped in and we're getting ready to hit into some demand if not already hitting demand now if you're a conservative player the best way for entry is when you start clearing the highs of the prior candles it can either be the top of this candle or the top of the prior candle again depending on how aggressive you want to be and how much you want to wait for confirmation but again this is a very quick momentum move that plays probabilities back to fill and balance again the key word there is probabilities in this case the market bounced and retraced the entirety of the morning move before continuing on in a slower range day now conceptually what happened here is the market created a definitive skew from 21,200 approximately down to 2,880 which is about 120 point V on NASDAQ it was sustained for about half an hour and then once that finally does bounce it creates a vac vacuum of sorts to fill that imbalance moved back up to the market open which is 21121 okay here's another one so again the time frame is between 9:45 Eastern and 10:15 Eastern which is this right here so the Market opens we have a quick move higher into 21443 and then quickly it drops from 443 down into about 300 so you're talking about about 120 point rejection you play back down here that starts right at the top of my time frame which is 9:45 and then moves lower now obviously there's plenty of other opportunity to talk about here but I'm talking about your quick scalp that gets you the imbalance move sometimes it results in a smaller move like this sometimes it results in a very large Trend but you see just like this in this time frame it works just as well now in this case I'm going to show you an example of how you can utilize this Theory to get into a trend early in the day when we have one of these crazy days that sells and then bounces and recovers the entire session this can help you do that and it can help you cage your bias as well and then of course we apply our time frame of 9:45 to 10:15 Eastern we have a nice little sell from the market open down and then what happens we have the volume coming in there to tell us that the buyers have hit so you can begin to place your entry somewhere around this area depending on your system and then up we go the hardest part of this particular trade would have would have been to survive the initial double bounce here if you could survive the double bounce and not get faked out by this little red then you would have yourself a very robust trend from 21260 up until 21560 which is about 300 points on NASDAQ which is a very healthy profit even if you did not survive this red you had a little scalp opportunity from 250 up to 350 100 points on NASDAQ here to play this particular move following the vpa volume either way the point is use any confirmation you want in terms of price action to get into these levels but just look for this time frame where it likes to bounce or reject depending on the opening Trend the theory here is again probability it's a very low probability event for the market to open One Direction and just keep on going or open down and keep on going without and move up down and then higher or move down and then up and then back down so the usual script for these things is for it to open One Direction counter back the other way to gather inventory and then continue on the trend or reverse into a range day but that is the probability now here's an instance of that very thing happening and even then there's still a little bit of a pullback it just happens after my time frame so if you look at the time frame between 9:45 Eastern and 10:15 Eastern we have one of those days that climbs higher and higher and higher until about 10:45 after about an hour and 45 minutes or so and then finally we have a little bit of a draw down but it's well outside of my time frame now yeah you could look at these little uh bottom wins here as a roll over you could have caught in the bounce back up sure but I'm not really in the business of trying to open and close a trade in the first 5 minutes I want to hold the trade at least 20 to 30 minutes maybe a little bit less if need be or even longer hopefully but I'm not really in the business of trying to scal a 5-minute candle so I don't really count these type of moves as a win on these type of days but there are days that it opens and goes directional for a very extended period of time and that's okay because the system is Not Meant to hit 100% of the time this is the point where you would stop out of the trade and then lean back on your risk management to keep you safe and keep your losses minimal but if you go back and look and back test this you can pick any random day and just back test this in this time frame you'll see this has a very high percentage of the of this counter move back to imbalance happening almost all the time obviously it's not 100% but it happens so frequently that it's a very important thing to see now this is a very common concept you'll see it all over the place but what's different about me is I don't like to tie myself to a particular time a lot of people will say well it's the first 15 minutes some people will say it's you know 10:00 some people will say it's only 9:45 but I like to look at it as a Time range between 9:45 and 10:15 this will allow me the ability to kind of be nimble uh and not be so centered on one particular time that I get faked out or take erroneous losses simply because it's at the wrong time because as we know timing is everything so to summarize this move before we wrap things up just remember when the market goes directional the first 15 minutes that is a very volatile period and usually that's where all the traps happen that's where they're baiting the hooks so the fish can come strike that lure and set the hook so be very careful trading the first 15 minutes let him shake it out and then you take the smart move to counter back to the imbalance now when I'm playing a move let's take a look at this that goes beyond the market open which is there it goes beyond the market open this is where I don't have a cryst crystal ball so I have to rely on my trailing stops so if I take an entry top Wick top Wick top Wick top Wick after a volume influx fantastic short entry if I'm fortunate enough to catch this move all the way back down to my target of Market open now is where you want to allow the trailing stops to make you a lot of money so instead of just simply closing my target here because I hit the market open I want to catch the entire mover as much as I can before they start shaking me out so instead I'm just going to roll a trailing stop a wellth thought out trailing stop down to finish this move off and capture as much as I can and then of course once you see the big volume come in that is usually stopping power and of course the market trends flat for the rest of the afternoon and that would be my trigger to start turning things up anyway I hope you learned something about this it's a fantastic very quick trade that you can make early in the day so you can go about your business the rest of the day and move on from the markets it's liquidity driven and it gives you a specific time frame on which to gauge your entries if you have any further questions about this please hit me up at options ler 2020@gmail.com of course you can ask questions in the comments of this YouTube channel or come over and join the Discord we talk about this stuff every day we have daily conversations about liquidity and General market moves I appreciate you taking the time to watch this video until next time I'm out see you