Smart Money Trading - Complete Guide for Beginners | Smart Money Concept Strategy

[00:07] . In this video, we'll discuss the most effective trading strategy, Smart Money Concept. Let's look at the basic tools of the concept. This video tutorial will help you better understand the market and start making consistent money

[00:22] trading. Watch the video to the end. Finally, we'll look at how to properly search for and enter into trades. But before you begin this concept study, please

[00:34] subscribe to the channel and give it a like. This motivates us to make new This motivates us to make new educational video tutorials.

[00:46] is a large capital in the market that has large volumes of assets and funds at its disposal. Typically, these are central banks of countries and large banks, financial funds, hedge funds,

[01:00] institutional investors and other large institutions. Among them, we can highlight such organizations as Bank of America, Goldman Sax, Barclays, and so on. Such players, with virtually unlimited capital, can exert global

[01:16] influence on the financial market, using specialized algorithms to literally control the price of an asset, achieving their goals and objectives. To analyze the behavior of such large market players, the

[01:30] SmartMoney concept was developed, which is a set of tools. I would like to draw your attention to the fact that we have a Telegram channel. In it, you will find a lot of interesting and useful information on trading, namely reviews and

[01:46] market analysis, important events related to macroeconomics and the Federal Reserve. I share trades and entry points, and publish useful educational materials on the SmartTMoney concept and trading in general. Be sure to subscribe, link in

[02:01] Be sure to subscribe, link in the description. instruments of the Smart Money concept. Market structure. We determine the direction of the trend. Market structure is the foundation for understanding

[02:16] price movement and market decision making. Using the structure, we can determine the trend, that is, the direction of the price, in which direction to open buy or structure, we first need to understand the term

[02:32] structural points. Pig. A pig is a structural point at which a price reversal occurs. To identify the structure, we must correctly find the structure, we must correctly find swing highs and swing lows, significant

[02:45] lows and significant highs on the chart. This will help us to correctly identify the direction of the asset and determine one trend or another, upward or downward. The minimums and maximums are usually referred to in the structure as follows

[02:59] maximums are usually referred to in the structure as follows : two H's mean high, a higher maximum. HL is high low, higher minimum. LH is lower high . And 2 L is lower low,

[03:16] lower minimum. There are three main types of structure: ascending, descending and consolidation. A sideways, or reange, upward structure is a series of higher highs and higher

[03:32] lows. A bearish market structure is a series of lower highs and lower lows. A period of consolidation when we have no

[03:44] higher highs or lower lows. In the market, we distinguish two types of trends. Global trend. The macrostructure is defined differently on higher timeframes: week V1, daily D1. A

[04:01] month is used less often, since it is a fairly long period of time. And the local trend, or microstructure, is determined on the lower timeframes of 4 hours H4 and the hourly H1.

[04:17] So, let's sum it up. We open trades strictly in the direction of the trend. Counter-trend trades are considered quite risky. To determine the trend, we use the market structure that we discussed earlier. We always give priority to the

[04:32] discussed earlier. We always give priority to the higher timeframe. we have an upward trend, updating highs without updating

[04:45] lows, and a downward trend, updating lows without updating highs. And the breakdown of the structure, also known as a breakdown of the structure, is referred to as boss. Break of referred to as boss. Break of structure. Boss is a breakdown of the structure, that

[05:00] structure. Boss is a breakdown of the structure, that is, the renewal of structural minimums and structural maximums. It is important to distinguish between when we have a breakdown of the structure and when we have a withdrawal of liquidity, as there are similarities.

[05:14] If liquidity is being collected , the price does not settle above an important structural minimum or maximum, but only removes liquidity with a wick. When the Boss structure is broken, the price is fixed by the body. If a

[05:30] liquidity trap forms, then, as a rule, a price reversal follows. In the case of Bos, the price continues to move. Additional confirmation that we have experienced a breakout, that is, a breakdown of the structure, is the consolidation of three

[05:46] candles above a significant maximum and minimum. To avoid confusion in the construction of the structure, a change in the direction of the structure is denoted by ch, and updating the structure in the same direction or confirming a change in the

[06:00] structure is denoted by boss. The boss is a breakdown of the structure. Updating structural minimums and maximums in the direction of the trend. Ascending is updating the highs, descending is updating the lows. What this is is a change in

[06:16] the nature of the market mood, that is, a change in the direction of the trend. Sometimes the first boss after Chytfirm, which is a confirmation from CHch that we have indeed experienced a change in trend. Examples: In the first example,

[06:34] we had a maximum update and a minimum update. We denote the minimum update as chч. An additional confirmation is the first boss or confirm. This means that it actually happened. And the

[06:51] actually happened. And the second example, when we don’t have a credit , there is no update of the maximum and no update of the minimum. The point is that if we haven’t updated the

[07:03] minimum for an ascending structure or haven’t updated the maximum for a descending structure, then we don’t consider the change in the nature of the market. This is just a complex we don’t consider the change in the nature of the market. This is just a complex correction. The

[07:19] premium and discount zones, as well as the optimal OTE entry point. In the SmartMoney concept, we use the Fibonacci correction grid to determine price correction levels after an impulse movement. The grid itself is constructed from the beginning of the

[07:35] impulse movement to the end of the impulse and the beginning of the correction. Levels 1 and 0 are set on the Swing High and Swing Low structural points. Using the Fibonacci grid, we can identify three trading levels: the premium zone, the

[07:51] discount zone, and the equilibrium zone. The discount zone is the price range of correction below the 0.5 level for an upward impulse. The premium zone is the price range of the price correction above the 0.5 level for a downward impulse.

[08:06] Equilibrium is the price range of the average price of an asset, that is, in other words, the zone of the equilibrium level or fair price. Large capital and traders are interested in buying at a discount in the discount zone and selling

[08:21] at a premium in the premium zone. The concept also uses the extended Fibonacci Ote grid, which is the optimal entry point. The Ote zone is in the premium zone if

[08:35] the discount zone if we consider long positions. It includes positions. It includes correction levels of 0.62, 0.705 and 0.79. These are the levels with the highest probability that the price will reverse in the opposite direction.

[08:52] Before continuing, I'd like to point out that the SmartMoney concept is described in detail in the manual on our website, and each SmartMoney trading instrument is also described in separate articles. You will find the link in

[09:07] separate articles. You will find the link in the description of this video. price movement. Liquidity plays an important role in price formation and movement. First and foremost, it is

[09:19] large players who are hunting for liquidity . Liquidity in the market is the , in principle, you need to start trading with and what the entire concept of

[09:32] smartmania is based on. SmartMoney liquidity is the price level of an asset where we have the most pending and limit orders, as well as stop orders and liquidations from the majority of market participants. Stop orders are essentially reverse

[09:47] orders to buy back losing trades. In order to secure a loss, traders set a stop-loss. These stop-prices are a price magnet. Due to this liquidity, a major player builds up his position. Large players have a

[10:01] clear view of where the largest number of 100 orders are located in the market. This is the basis for price movement from one liquid zone to another, thereby collecting money from retail traders. Types of liquidity in the market. Equal

[10:17] maxima EQ high and equal minima EQ low. Pig structural points are significant highs or significant lows. Boundaries of lateral

[10:29] price movement, i.e. range, flat or sideways. Trend movement liquidity behind the Trend movement liquidity behind the trend line.

[10:41] Imbalance is a price imbalance between the buying demand and the selling supply. On the chart, this is a strong impulse price movement that occurs after a major player has poured a lot of capital into the market. Under normal

[10:54] market conditions, price movement does not create gaps between candlestick shadows. This is defined as the effective price of the asset. When an inefficient price change or price imbalance occurs, it is due to a lack of liquidity in the market. On

[11:09] the chart, this looks like a strong impulse candle, within which a significant volume of the asset was traded. In this price range, there is an imbalance between supply and demand due to price inefficiency. The reason is precisely the

[11:24] lack of liquidity, that is, counter orders. This price imbalance is a magnet for the price, and large capital will try to large capital will try to cover the imbalance.

[11:41] big capital accumulated its position. On the chart, this is a candle in which a huge volume of an asset was traded with large capital. Before this, liquidity manipulation is carried out . There are two types of order blocks. A bullish order block is a bearish pullback

[11:58] candle that removes lower liquidity and buyers' stop losses . Then the price moves in an upward impulse direction. A bearish order block is a bullish pullback candle that removes the upper

[12:14] liquidity and sellers' stop losses. Then the price moves in a downward impulse direction. How to use order blocks? For us, the order block acts as an important

[12:27] tool for opening a position. Trades can be entered in three ways: from the start of Trades can be entered in three ways: from the start of the extreme, order block, wick or body, the extreme, order block, wick or body, or from 50% of the entire order block range.

[12:41] Stop loss is placed beyond the end of the order block boundary. In this example, we have an order block formed after liquidity capture. Next we received confirmation Ch. Each order block can

[12:57] only be tested once. Repeated attempts are not recommended. There is a high probability of getting a stop loss. An example of order block processing. The most conservative way to enter a trade is to get confirmation of a reaction on a

[13:13] lower timeframe. For H1 we obtain confirmation based on the structure M5M15. confirmation based on the structure M5M15. For H4 confirmation on 15 H1. On the senior order blocks for daily D1 we receive confirmation according to the H1H4 structure

[13:31] for weekly order blocks. Confirmation on H4D1. Order blocks of the month are traded very rarely. There we have confirmation on D1. Most often, you will have trades on order blocks H1 and H4, but it is

[13:49] worth closely monitoring the trend on higher timeframes. Let's look at an example of Order Block processing. Here we see the removal of lower liquidity. Next we see the

[14:01] last pullback candle. She was completely absorbed. completely absorbed. Next we see the formation of an imbalance. We select this order block. Now our task is to wait for the structure to break through and

[14:16] task is to wait for the structure to break through and the price to roll back to cover the imbalance. And we open the deal from the order block. Here we see a breakdown of the structure.

[14:30] the imbalance and enters the order block. From the beginning of the order block we enter into a position. We place stop loss beyond the order block. We set take profit for the highest We set take profit for the highest liquidity.

[14:54] block that is broken by an impulse price movement after the liquidity is removed, indicating the intention of a large capital to change the trend. On the chart, this is the zone where the structure breaks down, which may indicate a

[15:07] transition from an upward trend to a downward trend or vice versa. This pattern can be used in trading strategies to identify potential entry points. The breaker's task is to perform a price movement with manipulation to collect

[15:20] liquidity towards significant highs and lows, followed by a breakout in the opposite direction. The breaker block works on the same principle as the order block, except that the reaction from the breaker block occurs

[15:34] only after a strong impulse breakout. We have two breakout. We have two types of breakblock. Bullish order block. First, we experience a withdrawal of liquidity and the formation of a new minimum. Then an

[15:48] impulse breakout of the bearish order block occurs. order block occurs. Next is the broken bearish order block. will Next is the broken bearish order block. will act as a bull breaker block for us.

[16:01] And the second type is the bear breaker block. First, we experience a withdrawal of liquidity, the formation of a new maximum, and then an impulse breakout of the maximum, and then an impulse breakout of the bullish order block. Further, the broken bullish

[16:15] order block now acts as a bearish breaker block. Let's look at an example of a breaker block. We see a fence of lower liquidity and an accumulation of upper liquidity. Here we have the last pullback candle that was impulsively absorbed.

[16:35] imbalances. And also here we have this order block. We don’t take it as a priority because it is already a second order block. This order block is our

[16:47] priority. Next we see a fence of upper liquidity and a breakout of the Boss structure. Next we see that this order block was impulse-broken. Now we have a impulse-broken. Now we have a breaker block. When the price approaches this

[17:02] breaker block, we can open positions in a downward direction. liquidity. Before the breaker block, there was a seizure of this liquidity.

[17:17] The price entered this breaker block and reacted. Accordingly, we set the take profit reacted. Accordingly, we set the take profit for the lower liquidity. The

[17:30] block, but the only difference is that it does not update the minimums and maximums and thus does not remove liquidity before the impulse breakout. This tool is used much less frequently in trading. An example of the difference between a

[17:46] mitigation block and a Breaker Block. In the first example we have no maximum update. In the second example, the maximum was updated .

[18:00] an order block based on the long shadows of candles that appear after a price reversal. There are two types: bearish and bullish. A bearish cut block

[18:12] occurs at the moment of the formation of a price high with long wicks at the high of their candles and is located above the body of the candle in order to remove liquidity on the

[18:24] buy side before it falls. A bullish block occurs when the price has formed a long wick at the low and dropped below the body of the candle, removing liquidity on the selling side. Traders use the Rejection Block

[18:40] as a strong area of ​​interest when moving to lower timeframes. because there are fewer sellers or buyers on the market. Not because of

[18:54] increased demand or supply, not because of pressure from sellers and buyers. And the crowd, that is, you and I, also do not influence the price of an asset in any way. We are a drop in the ocean. The whole point is that large capital controls the price of an asset 100%. The basis of the

[19:11] asset price movement is imbalance and liquidity. The price tends to cover the imbalances, since the price was offered ineffectively, and then collect the accumulation of

[19:23] stop-losses of the crowd, since there is the maximum accumulation of liquidity, which is so necessary for adding and dumping positions. And yes, remember forever, large capital opens positions in both directions, that is, both to

[19:39] buy and to sell, thereby manipulating the price of an asset in order to accumulate or distribute positions. The main goal of big

[19:51] capital is to buy cheap and then sell expensive. And it doesn’t matter how much the asset itself costs . Hello to those who are waiting for Bitcoin at $100,000. A simple example. Look at the EUR/USD exchange rate, it fluctuates around 1 USD for 1 EUR, but

[20:07] it is considered one of the most liquid trading pairs on the market. A Poi zone of interest is a place on the chart where large capital is gaining its position. When the price approaches this zone of interest, a major player will

[20:22] defend its position. Pois can be identified on absolutely any timeframe, because the market always moves according to the same rules at any time interval . Our area of ​​interest is

[20:35] precisely the SmartMoney tools that we discussed earlier. These are order block, breaker block, mitigation, rejection block, inbalance, and so on.

[20:50] example is an order block. First, we see that the lower liquidity has been taken away, a see that the lower liquidity has been taken away, a change in structure has occurred, the price has rolled back, the imbalance has been covered, and the price has entered the order block. We open a take profit position

[21:03] for the highest liquidity. Rejection block is the same as orderblock. The only difference is that the Rejection Block has a is that the Rejection Block has a much smaller candle body and we

[21:17] have a long candle shadow. In fact, the deal is opened not from fact, the deal is opened not from the order block, but from the long shadow of the candle. It is believed that the largest amount of capital has been poured into it . On lower timeframes, a trade

[21:32] is opened from the beginning of the candle's shadow. We set take profit above the upper liquidity. A breaker block is an inverted order block. Initially, we had an order block in a descending structure. We punched it with an impulse. The

[21:47] structure of CH has changed. The lower liquidity was preliminarily taken away . When the price rolls back in the breaker block, we open a position. We set take profit for the highest liquidity. The Mitigation block is

[22:00] very similar to the Breaker block. The only difference is that we do not remove the lower liquidity in advance . There was an attempt to take this . There was an attempt to take this liquidity, but then the price impulsively

[22:16] liquidity, but then the price impulsively went up, there was a change in structure from the mitigation block zone; we open a Take Profit position for the upper liquidity. Finally, please like and subscribe to the channel. Write in

[22:29] the comments what topic you would like to see a new video on. In the next video, we'll take a closer look at how SmartMoney's tools work together. SmartMoney's tools work together. Thanks for watching.