Initial High/Low Setup⚡️
🧵 Thread
🧵 Thread
In this thread, the following will be covered:
- initial high/low concept
- execution/invalidation
- the theory behind the setup
- orderflow aids to help identify setup
- initial high/low concept
- execution/invalidation
- the theory behind the setup
- orderflow aids to help identify setup
the concept -
An initial high/low has to be put in on the chart, followed by a slow grind towards either the high/low put in on the chart.
An initial high/low has to be put in on the chart, followed by a slow grind towards either the high/low put in on the chart.
execution -
an SFP of the initial high/low is the execution.
HOWEVER, there are multiple different contextual things to look at before executing.
The most important is the context driven by the sideways price action towards either the initial high or low.
an SFP of the initial high/low is the execution.
HOWEVER, there are multiple different contextual things to look at before executing.
The most important is the context driven by the sideways price action towards either the initial high or low.
context (1) -
using the dynamic profile tool in Exo, I gather 2 figures of that sideways/slow grind PA.
- Net change in OI
- CVD
using the dynamic profile tool in Exo, I gather 2 figures of that sideways/slow grind PA.
- Net change in OI
- CVD
context (2) -
If we put in an initial low and I see via the dynamic profile tool that we are seeing a lot of NEW longs entering, I would be in even more favour of taking a long from an sfp of the initial low.
If we put in an initial low and I see via the dynamic profile tool that we are seeing a lot of NEW longs entering, I would be in even more favour of taking a long from an sfp of the initial low.
note -
on the opposite side, I would like to see a lot of NEW shorts coming in whilst grinding up slowly to the initial high
on the opposite side, I would like to see a lot of NEW shorts coming in whilst grinding up slowly to the initial high
theory -
the reason for looking for a lot of new premature positions is that they have a high likelihood of placing their stops above or below the initial high/low
this can then generate enough liquidity before sending price in the opposite direction.
the reason for looking for a lot of new premature positions is that they have a high likelihood of placing their stops above or below the initial high/low
this can then generate enough liquidity before sending price in the opposite direction.
invalidation -
invalidation of these trades is simply below/above the sfp low/high
you can also use the POC of the sfp candle as a potential invalidation to help increase final R.
invalidation of these trades is simply below/above the sfp low/high
you can also use the POC of the sfp candle as a potential invalidation to help increase final R.
trade management -
typically at a local max internal liquidity point.
(see image for reference)
typically at a local max internal liquidity point.
(see image for reference)
hope you found this thread valuable
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