Elements To A Trade Setup
In Episode 2 Mentorship of 2022 Michael Huddleston Discuss the element of trade

Price targets FVGs and liquidity
- When you expect prices to go down, be aware that there might be attempts to trigger buy orders or take out recent highs before the downward movement occurs. Similarly, when you expect prices to go up, there might be attempts to trigger sell orders or take out recent lows before the upward movement happens.


Short-term lows in prices can act as areas where sell orders are placed, creating liquidity in the market.
Important Time Frame
- Charts with 1-minute, 2-minute, and 3-minute time frames are considered useful for identifying imbalances in the market, especially for indices.
- The 5-minute chart allows more imbalances to develop compared to the shorter time frames.
- The term “FVG” is unclear without additional context, but it suggests entering a trade at a specific point, setting a stop order at the next candle above that point, and exiting the trade where there is liquidity.
How to determine what next weekly candle is going to do?
Before the start of a new trading week, it can be helpful to consider the potential direction of the next weekly candlestick.
Instead of trying to predict the exact closing price, the focus is on determining whether the next weekly candlestick is more likely to move higher or lower.
By analyzing various factors such as market trends, indicators, and other relevant information, traders can make an assessment of whether the next weekly candlestick is expected to have an upward bias (go higher) or a downward bias (go lower). This helps in forming a directional outlook for the upcoming week.

FACTORS THAT WILL IMPACT THE WEEKLY CANDLE
Here are simplified explanations of the mentioned concepts:
- Seasonal Tendencies:
Seasonal tendencies refer to patterns or trends that occur during specific times of the year in various markets or industries. These patterns are based on historical data and can provide insights into the potential behavior of prices or market conditions during certain seasons or time periods. - Interest Rates:
Interest rates are the cost of borrowing money, set by central banks or monetary authorities. Changes in interest rates can have a significant impact on various financial markets, including bonds, currencies, and equities. Generally, higher interest rates can affect borrowing costs, consumer spending, and investment decisions, thereby influencing market conditions. - Earning Seasons & Quarterly Earnings Reports:
Earning seasons are specific time periods during which many publicly traded companies release their quarterly earnings reports. These reports provide financial information about a company’s performance, including revenue, profits, and future outlook. The release of quarterly earnings reports can have a substantial impact on stock prices, as it provides investors and analysts with insights into a company’s financial health and can influence market sentiment. - Price Action on Weekly and Daily Charts:
Price action refers to the movement and behavior of prices on charts over time. Analyzing price action on both weekly and daily charts is a common practice in technical analysis. Traders study patterns, trends, support and resistance levels, and other chart formations to make informed decisions about buying or selling assets. Weekly charts provide a broader view of price trends and patterns, while daily charts offer more detailed information on short-term price movements.
Remember that these concepts are subject to market dynamics, and it’s essential to conduct thorough research, utilize appropriate analysis tools, and consider other factors when making trading or investment decisions.
Daily Candle Price Action
When analyzing price action on the daily chart, it can be helpful to consider the following question:
- Where are the liquidity pools that price can potentially reach, taking into account the assumptions made based on the weekly chart?
- Liquidity pools represent areas in the market where there is a concentration of orders, such as buy or sell orders. These areas can act as support or resistance levels and influence price movements.

- It is often observed that the daily chart provides more significant insights and opportunities to analyze liquidity pools. Therefore, it is advisable to dedicate the majority of your time and analysis to the daily chart.
- By focusing on the daily chart, you can receive feedback and observe price movements every 24 hours, aligning with the progress of the weekly candle. This allows for more detailed analysis and potential identification of key levels or patterns within the daily timeframe.
Train your eyes to see these patterns on lower time frame
For Bullish Pattern

For Bearish Scenario

Summary
Market makers have predefined target where the algorithm move the price. If the price move high we expect market first take sell side liquidity and buy side liquidity when move high or bullish.
Notes 0f Episode 1 ICT Mentorship 2022
2022 ICT Mentorship Episode 2 Video
Quote from 2022 ICT Mentorship Episode 2