[00:02] randomly. They think price just flies up and down based on news and emotions and and down based on news and emotions and chaos. When in reality, the market move in a very repeatable manner. And once you understand that, once you
[00:17] see the pattern, the charts will stop looking random and it starts looking readable. You will be able to read and understand price and trade price with extreme clarity and confidence.
[00:31] So, ladies and gentlemen, welcome to episode one of my Market Mechanics Mentorship Series, where for the next 30 days, I'm going to break down the real logic behind how market move, how to actually read price action, and how to
[00:48] think and trade like a professional trader. Now, before we get into today's awesome awesome lesson, I want to set a few house rules for this entire series. Number one, watch every lesson from
[01:03] start to the end. Don't skip around because you have a attention span of a fly. Just watch it from the start to the end. Okay, because every single lesson builds on top of the previous one. And you also don't want to be missing out on
[01:18] lesson. That's house rule number two. Focus. That's house rule number two. Focus. No distractions, no TikTok, no junk food on your table right now, none of that. No music. Focus, right? Focus on the
[01:33] lesson. See what I'm about to say and take down notes as you go about it. Number three, practice and apply what Information alone is not going to make you a better trader. Information alone
[01:47] is not going to make you profitable. Application of that information is. Implementation of that knowledge is the thing that is going to make you profitable. Right? So, please go and execute, practice, and apply all of
[02:01] these concepts I'm about to pass it down to you over the next 30 days. So, those are the house rules. As long as you follow these house rules itself, I guarantee you that by the end of these 30 days, you are going to be able to
[02:15] trade the market with confidence and clarity. Now, before I show you all the fancy trading concepts, the trading strategies, you know, the entry models, the setups, the execution, you first
[02:29] actually move. Because if you don't understand the logic behind price movement, you will always be reacting blindly. You will always be relying on external tools like chart patterns, indicators,
[02:43] signal groups to tell you when to buy and when to sell. You will never ever be able to become profitable by yourself because you haven't mastered the skill set that you need to analyze the charts, to read
[02:58] price for what it is. And that's what this lesson is about. Once again, the problem right now with most of the retail traders out there is that a lot of the beginners, they are focusing on memorizing candlestick
[03:10] focusing on memorizing candlestick patterns, using trading indicators, and just trying to read chart patterns. They try to memorize all of these formations without understanding why price is moving.
[03:23] And as a result, what happens is that every move that happens in the market feels too random, feels emotional, feels unpredictable, all because they don't understand price. They are looking at a chart, but they don't understand the
[03:38] mechanism behind the chart. They don't understand the heartbeat of the chart itself. So, here's what I'm going to teach you. This is fundamentally how the market move. This is why price move the way it
[03:52] does and it applies to every single asset class, every single market, be it stocks, indices, crypto, futures, options, commodities, forex, whatever
[04:04] asset that has a chart and has a candlestick chart, has a price in the financial markets, this logic applies to it. So, you must understand that price does not
[04:16] move randomly. It move because of an imbalance between buyers and sellers. When one side is stronger than the other, price tends to expand.
[04:29] every single market, it always move in this particular sequence where it expands, starts contracting, and then expands again, starts contracting, expands again, and then starts contracting.
[04:44] When price reach a certain area where the other side becomes active, this is where price will react to it. Okay, this is why a lot of times the market tends to trend, starts to pull back, consolidate, and then reverse or
[04:58] continue in that particular trend direction, and then start to pause, and starts to consolidate, and then starts bumping to either the upside or the downside again. This is because the market is always
[05:11] moving from imbalance to balance to imbalance to balance. Now, just to show you why that happens, it's fair value. You must understand that at the end of
[05:25] the day, the market always seek fair value. So, the markets are basically an oscillation of imbalance and balance because of the fact that it needs to find this thing called the fair value.
[05:42] that. So, at any given moment that's like an efficient market. Okay? Which means that there is a fair amount of buyers and the sellers in the market. But, at some point of time, demand tends to exceed
[05:56] supply. Which means there's going to be more buyers than sellers in the market. Or the other way around is supply exceeds demand, where there's more sellers than buyers in the market. There's more selling volume than buying
[06:09] volume in the market. And when there's this tug-of-war going on, and one side starts to win, you know, what tends to happen is that we got an imbalance, which is also known as inefficiency. Where the market tends to, you know, go
[06:23] this, where the market is just consolidating, going sideways, there is a equal amount of buyers and sellers in the market, and then boom, suddenly it bursts to the upside because demand has overwhelmed the supply, right? Because
[06:37] the buyers has took back control of price and kicked the sellers out of the So, this is the imbalance, right? So, you can see the market literally move from efficient market to inefficient market, from balance to imbalance, just
[06:51] then, because of the fact that this imbalance cannot occur forever, which means that price cannot go up forever, and price cannot go down forever, at some point of time it needs to look for balance. It needs to look for efficiency
[07:07] again. Which means that it's going to come back to balance again. cannot stay in this balanced equilibrium state for way too long. At some point of that going to win the tug-of-war, and then price is going to move to imbalance
[07:22] again. Okay? So, understand that the market cannot stay efficient forever. Because eventually, due to new information, whether that's the economic
[07:35] information, whether that's the economic factors, news, or sentiment of the market, demand will inevitably exceed supply, or vice versa, causing to occur. Once again, creating inefficiency in
[07:49] And then after that, price will look for balance again to form an efficient market. And this whole loop keep happening over and over again. This concept right here is what drive price fundamentally. This right here is
[08:06] what allow price to move. Okay? So, that's the concept of imbalance and balance. Your goal as a retail trader is to capitalize on the
[08:18] imbalance move because that's where the big money is at. If we know for a fact that price is going to move up by 100 pips or 100 points in the next few hours, ideally, we want to position ourselves before the
[08:34] move actually happens. So, we can capitalize on this huge move to the upside and make a lot of money. So, once again, your goal as a retail trader is to get in before this big move happens
[08:48] to capture the imbalance. And that's what market mechanics allow What I'm about to teach you over the next 30 days will fundamentally shift the way you perceive the market forever.
[09:01] And it will allow you to really capture these sniper entries where you can get in before the market move to the upside or to the downside. Because right now you are entering after the market has already moved. Your entry
[09:16] is way too late. But when you understand market mechanics, you can get in before the huge move. So, you must understand that at any given moment, the price is always in one of
[09:29] these four stages right here. I call these the four stages of price. This is pretty much how order flow works. Expansion, which is a strong move in one
[09:41] particular direction, either to the upside or to the downside. pulling back. You know what? Let me just draw that out here. So we got an expansion, which is a strong move to the upside, and as we
[09:55] know, price doesn't go up forever. Just like in the real world, gravity works in the market as well. Eventually gravity will pull price back to fair value. And that brings us to the next phase, which is the pullback phase.
[10:09] Okay, so as price starts pulling back, eventually it's going to start coming to a state of equilibrium, which is the consolidation phase, where there's a compression in price because right now we don't know whether the
[10:24] right? There's an equal amount of buyers and sellers in the market. There's indecisiveness, you know, demand and supply is like still in a tug-of-war. They are at a stalemate. I mean, nobody's really winning, right? That's
[10:37] what creates the consolidation phase. And then after the consolidation phase, one of two scenarios can happen. Either the market can reverse and starts to actually start coming down just like this, where the sellers has overwhelmed
[10:52] the buyers, where supply has exceed demand, go back to the continuation phase, which is the buyers overwhelm the sellers. Right now the pullback is over, and
[11:05] upside again. So that's the continuation, right? Because the market can either continue the existing trend, or it can cause this the existing trend, or it can cause this existing trend to reverse entirely and
[11:18] cause the market go from bullish to bearish. So those are the four stages of price. Once again, this is the heartbeat of the market. It moves from expansion to pullback, and then consolidation, and
[11:33] then it can either cause a reversal or a continuation in price. just quickly apply what we have just talked about, the concept of imbalance
[11:46] and balance. So, if I'm looking at a blank chart just like this, I can clearly see the phases where the market is in an imbalance state. And I can also clearly see the market where when is it all
[11:59] balanced state. All right, so just looking at this alone, I want you to try to identify the areas of imbalance and balance right now. Okay, just do that for like the next 10 seconds.
[12:13] you should be able to do it in 10 seconds. here, I can see that this is where we got You can see this imbalance move to the downside, imbalance, and then pull back. And then what happens after the
[12:27] pull back is the consolidation phase and then it's the continuation phase. Same thing happens again, right? After the imbalance, we got price pulling back and then starts consolidating around here.
[12:42] You know, just gathering more fuel before continue going down even further. This is what the imbalance and balance concepts looks like on a microcosm. On a
[12:54] macrocosm, this is where you can see like if you just look at this entire move right here, price did it came all the way down here and then make a drastic pull back and then started consolidating right here
[13:07] and then it will lead to another phase of imbalance. And then balance again and then this is where there wasn't enough supply in the market to cause price to continue going down. So, what happens is that the buyers has overwhelmed the
[13:19] sellers, demand has overpowered supply, which means that we're going to get a reversal to the upside where the trend direction has shifted from bearish to imbalance, the market cannot just go up
[13:33] forever. No. It tends to pull back again, consolidate a little bit, and then go again, pull back again, consolidate a bit, and then go again. consolidate a bit, and then go again. This is just how price move.
[13:45] Okay? So, yep, you can see price doesn't move because there's a freaking candlestick pattern right there. Price doesn't move because Bollinger bands cross over. Price doesn't move because you see a double top. No.
[13:57] It move because it's actively seeking fair value. concept for you, right? Just to help you understand the skeleton of price, which is market structure. Now, once again, we're going to have a
[14:12] lesson that is catered towards this where we dive deeper into market structure and the nuances of it, like the swing structure and the internal structure. For now, I just want you to apply like this concept of imbalance to
[14:25] balance to market structure. So, market structure basically states that at any given moment, the market can only move in three directions. You can either go up, down, or sideways.
[14:40] That's it. It cannot move in zigzag patterns or like, you know, circle patterns or like, you know, circle patterns. No. It can only move up, down, or sideways. All right? That's it. Now, when the market move up like what
[14:54] you were just mentioned, it cannot go up forever. Same thing. When the market go down, it cannot just go down forever. At some point of time, it needs to have balance, and then imbalance again, and
[15:06] then balance and imbalance again. And that's what creates market structure. So, in a uptrend, since price doesn't go up just like this, what tends to happen is that price goes up, pulls back, and then goes up again, pulls back, and
[15:21] then goes up again, creating what we call higher highs and higher lows. highs and higher lows is because of the fact that this high is higher than the
[15:33] previous high. This low is higher than the previous low. So, if we see higher highs and higher lows in the market, this means the market is in an uptrend. Price is in an uptrend. And if we want to trade with
[15:46] the trend direction, which is the uptrend, we want to look for longs. We want to look for longs at all of these higher lows right here because we're expecting price to create a new higher low and then continue moving to the
[15:58] want to capitalize on. In a downtrend, it's the opposite. This is where the market will want to create lower highs and lower lows. This high, lower than the previous high. This low, lower than the previous low.
[16:14] So, we can expect this downtrend to continue, and we want to look for shorts at all of these lower highs right here so that we can capitalize on this move to the downside. So, if you see lower highs and lower
[16:28] lows being formed in the market, this means that the market is in a downtrend. And once again, if we want to trade with the trend direction, we want to enter the for sales. We want to enter for shorts
[16:40] to be in alignment with the institutional flow of money, which is the prevailing trend direction. The third trend direction is consolidation. Like what we've just mentioned, what is the consolidation?
[16:55] It is basically a state of balance. It's basically the market being in fair value. There's an equal amount of buying volume and selling volume, there's market doesn't know where it wants to go up or down, whether it wants to continue
[17:10] or reverse. So, as a result, it will get stuck in this consolidation. beginner, you want to stay away from trading consolidation because it's very
[17:22] trade. We are going to discuss why over the next few lessons. But for now, just understand at the basic fundamental level, the market can only move in three sort of direction,
[17:35] up, down, sideways. That's it. Higher highs and higher lows, it suggests that strength. Okay, it's going to continue going up. Buyers are in control. Lower highs and lower lows suggest the market is weak.
[17:48] Price is just going to continue falling. When you understand market structure, you are able to see with your bare eyes who is in control of price, whether the bulls or the bears, whether the buyers or the sellers, whether the demand or
[18:02] the supply. So, once again, let's try to apply this what you can see on the screen right here. right, if you are confused, take a drawing tool just like this and try to
[18:15] draw and trace out and outline the skeleton of the market. Okay, just outline this. You can see when once you outline, you can see it very clearly. In this case, is the market in an uptrend or downtrend?
[18:30] Well, you can see it's clearly in a downtrend. Why? Because market structure says that in a downtrend, price is creating lower highs and lower lows. And in this case, is this high lower than the previous high? Yes, it is. Is
[18:46] this low lower than the previous low? Yes, it is. Since we are having lower highs and lower lows in the market, this means that the market is actually going down. As simple as that, right? It's just math. No rocket science here, guys.
[19:02] here? Right, well, once again, demand overpower supply, buyers overwhelm the sellers, price went up, pulls back, goes up again, pulls back, and then goes up
[19:16] again. So, this time round is this high lower than the previous No. Not really, because this high is high. Is this low lower than the previous low?
[19:30] Not really. This is the last low, and this high is higher than the previous low. So, right now we have established that the market is creating higher highs when this high is higher than the previous swing high, and higher lows
[19:43] when this high is higher than the previous low. Guess what? Do the math. Higher high plus higher low equal the market is going up. The market is an uptrend. So, this tell us that the buyers are in control of price. Demand
[19:57] is in control of price. That's the concept of market structure. Like I said, we're going to go into the nuances in of market structure. We're going to talk about how to combine the different market structure with
[20:10] different time frames later on when we get more advanced, where we have like an entire lesson that is catered towards talking about market structure. For now, just for the first episode, this is good enough for like the basics. Like this is
[20:23] understand. That's how the market move. Now, not to get too complicated, but I want to just introduce one finer concept which ties in to the whole ethos of why price move the way it does. And that is
[20:40] liquidity. Okay, that is liquidity. Now, as we have established earlier on, the market move from phases of to balance, and then balance to imbalance again. So, in this case, you
[20:54] can see imbalance, balance, and then imbalance. And now you might be wondering, what causes this move right here? What causes the imbalance of price? We have literally just covered that the reason
[21:06] why there's an imbalance prior of price right here, where price go down so aggressively, is because of the fact that supply has overpowered the demand. The sellers has overwhelmed the buyers, kicked the buyers out of the arena.
[21:23] is the terminology What is the fuel that actually causes this this move to happen? this this move to happen? And that is what we call liquidity.
[21:36] into these. We are going to have lessons subject alone, liquidity. Liquidity is the fuel the market need to move aggressively to the upside or the downside.
[21:52] So, just like a car, the market cannot move up or like keep on moving forever. It needs to stop at a gas station to get more fuel, right? To gas station to get more fuel, right? To get more petrol, whatever, before it got
[22:06] more fuel to continue on its way to its destination. It's the same thing right here. Liquidity is that fuel. Right, you can see the market paused, take a breather at a gas station, and then boom,
[22:19] liquidity step into the market, cause price to continue going down aggressively. Once again, your job as a retail trader is to capture this imbalance move. And how you capture this imbalance move is
[22:32] by understanding liquidity. Because the market is always constantly seeking liquidity. Because that's the fuel it need to move very aggressively in a particular direction. All right. So,
[22:47] now, where where to spot liquidity? It's going to be above the swing highs, below the swing lows, and above or below certain chart patterns or obvious zones or support and resistance levels.
[23:02] deep into this because this is only like the beginner lesson. I don't want to confuse you. I just want you to like, you know, create that seed in your head, right? Just so you know, this is really
[23:14] right? Just so you know, this is really why price move the way it does. Now, let's talk about why beginners [snorts] some of them might understand this concept.
[23:28] The reason why they fail is because they tend to chase after price during an So, in this case right here, price has moved up so aggressively, right? So, this is where a lot of retail traders they look at this and they say, "Oh my
[23:43] god, this is a once-in-a-lifetime opportunity for me to get rich. I have to get in here for a long position. If not, I'm going to miss this move. I got to get in right now, man. If not, I'm going to be poor." All right, so they
[23:55] enter for a buy right here. And just look at what price does right after they enter for a buy. Price goes down and reverse literally right after they enter for a buy.
[24:09] And they wonder why this happened. It's because you are not trading price. You are just trading your ego. You are not trading price. You're just You are not trading price. You're just trading your pride.
[24:25] the market move from imbalance to balance, you will know that your goal as phase. So, that you can capture the imbalance. Your goal is not to get in after the imbalance, but rather before the
[24:39] imbalance. So, if you succumb to the fear of missing out, you're going to get bad entries just like this where the market reverse right after you enter. And when that happen, you shouldn't be
[24:51] pointing your fingers at the market and saying, "Oh my god, the market knows where I place my stop loss. The market is manipulated. No. The market is doing what it does best, which is move. And if you did understand
[25:04] order flow, if you did understand the concept of imbalance to balance, you would have avoided this loss right here. So, that's why that's one of the many reasons as to like why retail traders tend to get
[25:18] to get a bad entry. Why that they tend to get stopped out. Another thing is that they tend to panic during pullback. For example, let's say know, they managed to capture this very nice imbalance move to the upside.
[25:33] Right? So, maybe they place their stop loss below this low right here, and then around there. And when price starts pulling back here, okay, this is where maybe they're up
[25:46] like $5,000, and then now price has came all the way back down to where they entered the trade for the first place, and then now they're panicking. And then now price goes into the red. Oh my god, no. I'm like down $1,000 right now.
[25:59] Right? They start panicking during the pullback. Once again, you're not trading the market, you're trading your emotions. So, as a result, what happens that they tend to enter and they exit the order right here.
[26:12] And when they exit the order, next thing you know, price continue going up in their way, and later on price went up there and hit TP. all because you were trading your emotions. All because you don't
[26:24] Uh another common mistake is that they tend to enter way too early during reversal. Right? So, in this particular case itself, what happens that let's say they see price actually, you know,
[26:38] they're like, "Oh my god, price has reached a support level. I'm going to reversal." And then what happened next is that price once again starts going down. Why? Because they don't understand market
[26:52] structure. They don't understand that right now the sellers are still in control of price. So, if you're entering over here, you're assuming that the upside. But, is that what's actually going to
[27:05] happen? Did you actually got your confirmation that the market is actually reversing to the upside? If the answer is no, then my friend, you ain't trading the market. You're trading your emotions. You're trading your
[27:18] trading the market for what it is, you're trading the market for what you think it's going to do. You're trading the market for what you think will happen. Your perception of the market is not the
[27:31] Your perception of the market is not the reality of the market. simply be avoided when you really just understand that price often needs to
[27:43] rebalance. It needs to retrace. It needs to seek fair fair value. It needs to grab liquidity first. It needs to cause the structure to shift first before it can get the next move to the upside or to the downside.
[27:57] So, that is why I actually spent a lot of less a lot of my time just working on this first lesson because I really believe that a lot of traders think that they are losing because of emotions. When in
[28:10] reality, they are losing because they are misunderstanding the market movement. Because they are just not trading the market for what it is. They're viewing the market from the
[28:22] limited lens that they have put on themselves. >> [snorts] >> So, that's why retail traders get trapped. That's the old lens. That's the old paradigm. That's the old way
[28:35] that allow you to to see the market. And what got you here will not get you to where you want to go. In order for your results to change, you have to change the lens in which you perceive the markets from.
[28:50] You have to change yourself. So, right now I'm going to give you a new lens. Change I'm going to have you change your glasses. I'm going to make sure that these glasses allow you to see the market clearly for what it is.
[29:04] So, from now moving forward whenever you open a chart just like this, a blank chart just like this, I want you to ask yourself these few questions. Is price expanding, pulling back, or consolidating?
[29:19] the live market condition. You can see it right now we are looking at EUR/USD it right now we are looking at EUR/USD on 20th April at the time on 20th April at the time it's we are like 44 minutes left to the
[29:33] closing of this 1-hour candle itself. So, live market condition. I'm going to right here. Ask yourself, is price expanding, pulling back, or consolidating? In this case, price is in an uptrend,
[29:47] higher high, higher low, and then another higher high, and then this is potentially another higher low. Okay, potentially, not certainly. So, right now price has just gotten the
[30:00] expansion phase right here. And it has just gotten this fair value right here again. Okay, so it has just gotten from are in the imbalance phase where price has broke out of the consolidation.
[30:15] And in this case, since price in the uptrend, it needs to create a new higher low before it can continue going up even further. So, this right here is most likely a retracement for price to create a new higher low, and then later up just
[30:29] continue going up even further. So, in this case you can tell yourself that this is maybe the imbalance phase, and price is actually pulling back. phase. If you want to get even more precise, you will see that this move
[30:43] phase, right? Where the market was actually going down very aggressively. didn't cannot go down, it needs to grab more fuel. Guess what? Now we are in the
[30:56] pullback phase, where the market is pulling back. And now you want to ask yourself, who is in control right now? Buyers or sellers? So at this point of time, we were in a consolidation right here, and then price
[31:09] broke to the downside, right? Bursting out of consolidation to the downside. structure, the buyers are in control of price because price is creating higher highs and higher lows. But if we are looking at right now, right? The most
[31:25] recent price action, the sellers might be in control because buyers, price to break out this consolidation to the downside.
[31:38] Right? So right now, the sellers must be in control of price. precise and look at the most obvious, the most recent price action, which is this right here, you will see that the market is
[31:52] potentially shifting bullish. Now, why is it shifting bullish? It might be shifting bullish in the short term to facilitate the pullback. balance, imbalance again, and then balance, and then potentially we got a
[32:06] balance, and then potentially we got a continuation or even a reversal. Now, where are the obvious highs and lows? Right? So obviously, this is where you can define a swing range. Once again, we're going to cover more about
[32:18] this in the market structure lesson, but for now, you can just look at the highs and the lows. Very obvious with the naked eyes. naked eyes. Let me just take a sip of tea.
[32:31] >> Ah, you can't do a trading geek lecture without tea, man. >> Okay, that's so good. All right, so where are the obvious highs and lows? So, in this case, high here, low here, high
[32:44] here, low here, high here, low here. Literally as simple as that. Once again, I'm going to walk you through the principles that I used to identify highs and lows in the market structure lesson, but for now, for the first lesson, keep
[32:57] things simple. Just go and identify the most obvious highs and lows. And where might price be drawing to it? Right? Once again, we know that price is moving from imbalance to balance and imbalance to balance. So, in this case,
[33:10] price might be potentially pulling back to this imbalance that we have on the balance, and later on, it can just continue going up and just fueling the next phase of imbalance. Is the market continuing or preparing to
[33:23] shift? Right? So, right now, the market has been going down, and then right now, So, what we can potentially have happen is if the sellers are in control of price, we can expect a new lower high being formed right here, which is lower
[33:37] than this high, and then just continue going down and then potentially creating a new lower low, which is lower than this previous low, and we know that price might be shifting bearish in the short term to have a short-term
[33:49] short term to have a short-term downtrend to facilitate the pullback to maybe some areas of demand, and then later on, demand step back into the market causing price to go up even further.
[34:02] Okay, so these are the five key questions that I want you guys to ask a blank chart. If you can answer these questions with confidence, you will be able to analyze
[34:15] the charts with a lot of clarity. You won't have brain brain fog, you won't have analysis paralysis, you will be able to understand what the market is doing right now, who is in control of price, and whether you
[34:27] should enter for a buy or enter for a sell. differently, right? Because my goal here over the next 30 days is to just rewire
[34:41] your mind. It's to reprogram your mind to stop trading like the retail trader, stop trading like how you've been doing, and start thinking, acting, and feeling like a professional trader so that you too can get the results of a
[34:57] professional trader, which is consistent profits. And you should understand by now that the market is not random, right? Price always move with logic, structure, and intent. Nothing happens by coincidence.
[35:12] And once you understand that, you stop reacting blindly, and you start reading reacting blindly, and you start reading the chart with more clarity. market actually move, the next step is to understand the market you're actually
[35:25] trading, which is why in the next episode I'm going to break down how to trade Forex. I'm going to show you the introduction to Forex, what Forex trading is, how currency pairs move, what time to trade, and what you
[35:38] actually need to know before you even place a trade. If you guys want extra support beyond this free series, I will leave some useful links in the description below to the tools and platforms that I
[35:50] personally use and recommend, including my private mentorship program, my use. With that being said, I look forward to speaking to you guys in episode two, and as always, remember you're just one
[36:05] as always, remember you're just one trade away. Mwah.