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okay folks welcome back this teaching is
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going to be specifically dealing with
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the ICT London open kill zone okay so
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the London kill zone what ICT concepts
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are going to use in this module the
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importance of time and price again the
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London open the London session important
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characteristics of London okay folks
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this is one of those topics where it's a
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very vast subject so I'm introducing you
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slowly into one of the most important
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time frames of the 24-hour banking cycle
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the lung and open is typically a time
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where I like to trade because it gives
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me a lot of opportunities and it's well
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it's magnitude is a lot more favorable
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for a short-term trader it comes with it
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a great deal of responsibility in terms
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of knowing what the higher time frames
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are doing a lot of economic calendar
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releases come out overnight and they can
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be very volatile but the euro dollar and
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the British Pound pairs are ideal for
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this time of day
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and that's why I've elected to trade
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those two pairs the lung and open
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frequently sets up an optimal trade
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entry pattern that can offer 25 to 50
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pips for a scalp the key times to
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monitor are 2:00 a.m. to 5:00 a.m. New
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York time so in other words the easiest
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way to avoid me confusing you about the
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time is determine whatever time it is in
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your area relative to what it is in New
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York time okay and physically wait for
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2:00 a.m. to be in New York and then
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calibrate that with your broker and your
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local time and always
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a clock for New York and you'll know
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exactly what I'm referring to in terms
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of time it's the easiest way I can
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overcome that barrier because it's been
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a point of confusion many times because
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I don't know where you are globally and
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you're all in different locations of the
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globe I don't know what the the
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translation is going to be in terms of
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time so the conversions are going to be
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up to you but the ideal ICT London kill
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zone for your learning is going to be 2
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a.m. to 5 a.m. and it's relative to New
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York time now if you look at this chart
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here this is a euro dollar chart and
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what I'm highlighting here is two
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specific trading days and I want you to
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take a look at the red it's like a deep
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red vertical line is two of them
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immediately to the right of the leftmost
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vertical red line we see price action
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drop down initially and then rallies up
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and it creates the very high of the day
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the day's low forms down here and it
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comes off a low and close closes off the
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low the next trading day again here is
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the vertical red line and it's telling
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aids New York time midnight
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ok so midnight in New York that's what
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this vertical red line delineates for
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this particular day and this represents
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midnight in New York on this trading day
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so we can see that the price rallies
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again for the euro dollar up into this
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small little segment of time and it
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creates a high and trades down crease to
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low the day later on and goes in
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consolidation and closes in the middle
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of the range the key takeaway that I
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want you to more or less be encouraged
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to go through your charts and study is
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that London open generally has the
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highest probability of creating the high
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or the low of the day so here we see
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price trading up to and this little blue
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line
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segment and this little blue line
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segment is just delineating that little
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pocket of time that window of
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opportunity between two o'clock in the
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morning and 5:00 a.m. New York time you
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can see how beautifully goes up trades
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makes the high the day and then trades
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progressively lower same thing here on
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this day it trades up spikes up creates
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the high the day and then sells off ok
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this is one of the biggest things that a
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lot of students of mine and people that
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have dis casually looked at my things in
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terms of my tutorials this is one of the
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biggest wealth in my career it was the
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biggest discovery because it helps me
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determine where when I'm bearish the
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actual height of the day is going to
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form and if I can do that with a
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reasonable measure of accuracy or
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consistency just imagine if you could
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get three to four opportunities where
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you can get the high or very close to
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the high today and ride the majority of
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the daily range if you could do that a
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few times a month you can do
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exceptionally well as an FX trader now
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it doesn't limit itself to just forex
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this same phenomenon occurs in other
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assets now I don't trade Bitcoin or
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cryptocurrencies but I have students of
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mind that swear by this working in that
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asset as well it works in commodities it
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works in bonds it works in just about
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everything that trades electronically
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overnight incidentally you can
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anticipate things like this to occur in
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index trading so if you're trading for
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instance the dax the the flipsie or the
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sp500 or doubt or Nasdaq futures
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contracts overnight trading you can see
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the same phenomenon occur as well so it
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really isn't limited to just Forex now
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because I taught it to the trading
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community they assumed that it was
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limited and only salient to Forex or
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foreign exchange
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I used this same concept as a commodity
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trade
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in early 90s so it's not that we have a
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asset class that it can only function in
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with this type of trading or this type
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of price action it's completely
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Universal and that's pretty powerful now
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if we have a market that is let's say in
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a strong trending environment you want
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to be really focusing in on London
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because London will give you at the
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highest probability of a low-risk entry
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price point okay and conversely we can
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see when the market is bullish the
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tendency is for the market to trade down
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creating the low of the day in the lung
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and open ICT kills him again here market
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trades down after midnight in New York
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time creates the low of the day between
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2 o'clock and 5 o'clock in the morning
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New York time low as they forms off to
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the races we go so here's to
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back-to-back trading days ok if you
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could have taken along not even at the
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low ok say you use some of I'm on maybe
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a buy stop to get in ok if you trailer
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by stop above these individual candle
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highs and eventually it trips you in
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gets you long and this is held onto it
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for 30 40 pips each trading day it adds
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up quickly folks same thing here market
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creating a low takes off aggressively
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now I want you to take a look at the
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relationship between 1 lung and open low
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and the immediate day after lemon open
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low okay we have a range that's framed
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by the low here and this highest high in
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between the two London lows this is your
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trading range right here
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this would be an optimal trade entry
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long using previous day's data to
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today's London set up so you can get an
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optimal trade entry on that and price
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has an expansion on the upside and we
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can see a very nice opportunity to head
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a long trade on both days here focusing
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on London open creating the low the day
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when the interlining
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market is poised to go higher okay so
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the London session itself actually
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trades a little bit longer than five
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a.m. okay but for the sake of my
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concepts I want to graduate over time
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the significance of five o'clock in the
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morning New York time to set o'clock in
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the morning New York time which is
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classically like a London lunch the
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period where it can go quiet it can have
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minor little retracements but I don't
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like to see any type of entry between
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five o'clock and seven o'clock in the
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morning New York time because it can
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tend to wait for the New York open which
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will cover our next lesson but the price
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action during the London session sees
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the highest probability of a large
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directional move in the 24 hour day so
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what does that mean if we were to look
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at the entire 24 hour market and pick it
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picked up beginning point and filed it
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around the entire world and where it
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began it'll end so we have 24 hours of
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time if we were to measure the volume or
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how much action if you wanted to call it
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any other word its its layman's terms
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the most bang for your buck is going to
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be in the London open now that right
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away
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draws excitement to younger guys and if
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you don't know what you're doing you can
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get really hurt quick in the lemon
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session because it can be extremely
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volatile and it can be like a lightning
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bolt okay if you're caught on the wrong
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side of the marketplace and there's a
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high impact you
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event that's out during that timeframe
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you can get mowed over rather quickly
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and if you don't use stop-loss orders
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that session is going to treat you very
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cruelly in the form of taking money from
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you because London can be extremely
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one-sided and once it takes off it's
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pretty relentless it doesn't really give
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you a chance to get off the hook and the
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London trading session actually extends
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beyond the 5 a.m. our to 7 a.m. New York
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time the London session sees the highest
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volume of order execution than any other
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trading session if we look at the little
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chart to the right and again all I'm
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trying to do is show the profile itself
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we don't need to zoom in and look at
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details of wicks and candle bodies I
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just want you to look at it graphically
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in terms of the way the range is expand
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and how it looks overall so we have
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trading day here of consolidation it
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creates a little bit of a run up rejects
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that and trades aggressively lower and
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then comes off the low and begins the
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New York session so we have a micro
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power 3 formation in here so we have the
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open the rally up the expansion low off
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the low closes ok prices fractal folks
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we can anticipate seeing duplicate
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patterns that are seen on higher time
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frames on a lower timeframe so if we
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understand it's a daily range if it's a
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bearish market profile or for looking
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for lower prices the opening on the tail
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you range or the only bar it's going to
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be at or near the high today the high is
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going to be very limited in terms of how
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much it goes above the opening price and
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then the largest portion of the range is
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going to be between the open and the
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close and the close is going to be near
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the low of the day well this is intraday
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price action between this vertical line
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here in this vertical line here this is
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delineating 2 o'clock in the morning
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to seven o'clock in the morning New York
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time okay so we're looking at a window
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of five hours so if we understand that
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price can be fractal and we're bearish
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this could be viewed as a micropower
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three formation okay now why is that
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significant and why should I be teaching
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it to you what's the point of it well if
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we see in this trading day here it
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creates a scenario where let's assume
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for a moment that we were anticipating a
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bullish market move okay maybe this
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particularly to a trade down to a level
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that was some kind of a support level
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and we came off of it traded
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consolidated okay and then we came down
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initially right after the two o'clock
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time period and price drops down into a
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significant low if price doesn't start
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to run there during the London session
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we could reasonably expect that the real
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moves going to be in the next trading
00:14:32
session which would be the New York
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session which is not going to be our
00:14:35
teaching here it's the next lesson in
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this series but you can see the move
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ensues after the crossover from the
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London session and then the beginning of
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the New York session now the London
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session
00:14:51
technically extends even beyond seven
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o'clock in the morning up into ten to
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eleven o'clock in the morning New York
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time okay so basically it's three
00:15:02
o'clock in the morning New York time to
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11:00 a.m. to noon all relative to New
00:15:10
York time okay so there's an overlap of
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New York and London trading which makes
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the next teaching a little bit more
00:15:18
interesting as well but the takeaways I
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want you to have is is that the London
00:15:23
session can create the high or low of
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the day and we can also study the
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profile that takes place
00:15:32
between the beginning and ending of the
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overnight session if it's trending okay
00:15:39
if we have a trending model like this
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chances are we could see a rather quiet
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New York session it doesn't mean that
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always but it's one way I'd like to look
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for potentially a slow New York session
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or we could have a reversal scenario
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which is what we saw here okay to the
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right of this vertical line is the New
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York session you can see it did have a
00:16:02
little bit reversal but went
00:16:03
consolidated and basically traded in the
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middle of the overall range into the
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close the very next day we had a initial
00:16:11
drop down in London creating a low of
00:16:13
the day but it closed the session and
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right in the middle so it didn't really
00:16:17
have much of a trend it had a spike low
00:16:20
but if we're bullish it didn't really
00:16:22
show any kind of indication that in the
00:16:24
London session but soon as we crossed
00:16:27
over into the New York session and
00:16:28
overlap with London then we have the
00:16:32
optimal trade entry then we have the
00:16:36
dynamic imbalance or the range expansion
00:16:39
occurs for the for the daily upside and
00:16:42
up close so London gives us a lot of
00:16:47
things to study and I want you to go
00:16:50
through your charts and look for
00:16:51
examples of the things like this
00:16:52
outlined here and I think you'll be
00:16:54
rather surprised okay the London session
00:17:01
characteristics
00:17:02
now abundant session typically creates
00:17:04
the low of the day when the market is
00:17:06
primarily bullish and the high of the
00:17:08
day when bearish when the market is
00:17:11
poised to trade higher on a daily
00:17:13
timeframe we can focus on the London
00:17:15
session to post a low of the trading day
00:17:17
if the daily is poised to trade lower we
00:17:20
can focus on the London session to post
00:17:22
the high of the trading day
00:17:33
okay
00:17:34
and what I've done is instead of putting
00:17:36
the Fibonacci on the chart and
00:17:37
cluttering it all up
00:17:39
I just basically drew a line indicating
00:17:42
the high I'm using and the low I'm using
00:17:44
now I'm not using the body of the body
00:17:47
reference points because it's a daily
00:17:49
time frame and I want to encapsulate the
00:17:52
entire range with the wicks included it
00:17:56
will not change what I'm going to show
00:17:58
you here so if you have your daily
00:17:59
timeframe on your your $1.00 you'll see
00:18:02
that it will still take us up into
00:18:03
optimal trade entry which is basically a
00:18:06
non indicator form of overbought or
00:18:09
oversold okay so what we're seeing here
00:18:13
is the market on the Euro trading up
00:18:16
into two seventy point five level
00:18:18
failing to get to the 79 level and this
00:18:20
candle right here shows a willingness to
00:18:23
want to reverse so the next candle we
00:18:27
could potentially see this be a bearish
00:18:28
candle now I'm not looking at swing
00:18:31
points I'm just looking at in terms of
00:18:33
where we are in the higher time frame
00:18:36
and this could be a point of interest
00:18:39
for a breakdown okay so once we have a
00:18:43
bearish candle like this and we're
00:18:44
inside the area of optimal trade entry
00:18:46
for sell or we would be deemed as a
00:18:50
potential sell the very next candle we
00:18:53
want to study that because it may give
00:18:55
us a condition that frames a power 3
00:18:59
formation with a Down close relative to
00:19:03
the daily chart okay
00:19:05
so we have this particular day here
00:19:08
which is the 28th of November and we
00:19:13
have the market trading sideways until
00:19:16
midnight in New York and then we have
00:19:19
the market initially drop down we do not
00:19:23
worry about that we want to see it rally
00:19:26
up into London open it starts this area
00:19:31
right here it's dropping here we want we
00:19:33
don't want to see that we want to see
00:19:35
price rally up that's where we'll sell
00:19:38
notice also that we have equal highs in
00:19:41
here
00:19:42
okay about 10 pips above this short-term
00:19:44
high that gives us the high of the day
00:19:46
at the same time we would reasonably
00:19:49
expect to see London open create the
00:19:51
high today why should the daily bias be
00:19:54
bearish because it's been going bullish
00:19:56
here while we treated into an area of
00:19:58
optimal trade entry and we got one
00:19:59
candle showing a willingness to reject
00:20:02
and go lower so we want to look for
00:20:05
characteristics like we're seeing here
00:20:07
you open and then rally above we can
00:20:09
look to be a seller there after it takes
00:20:11
equal highs out so we have candy lien by
00:20:16
stop liquidity pool okay runs up knocks
00:20:19
the stops out and then trades
00:20:22
aggressively lower grates the load of
00:20:24
the day it comes off a low thing trades
00:20:27
at or near below so in relationship to
00:20:33
power three if we're looking at this
00:20:35
price action here you can see that would
00:20:38
be the daily range so we can see that
00:20:40
the opening it's a very limited upside
00:20:43
movement above the opening that's just a
00:20:46
little portion of price action here it
00:20:48
creates the high of the day during the
00:20:50
London open kill zone between 2 o'clock
00:20:51
and 5 o'clock in the morning dynamic and
00:20:54
balance or range expansion for the daily
00:20:56
candle or bar creating the low of the
00:20:58
day right here then we come off the low
00:21:01
trading near the low of the day in
00:21:03
closing right here so this is this you
00:21:07
know this whole candle right here this
00:21:11
is what it looks like in a open high/low
00:21:13
close for a minute so hopefully you
00:21:15
found this teaching insightful and until
00:21:18
next time I wish you good luck and good
00:21:19
trading
00:21:27
you
