Market Maker Series Vol.

1 of 5

-Central Banks are the market makers, not brokers or investment bank dealers.

-Central banks are responsible for managing the currency price.

-Currency prices are 100% controlled and manipulated.

-Central banks do not follow retail indicators or flawed retail logic.

-Central Banks function on an algorithm that runs the price and it does not run on Supply

and Demand.

Understanding Macro-Quantitative Analysis

-Quantitative analysis refers to an understanding of the price based on measurable data.

Something numerical. Not up to interpretation.

Q: What should the market be experiencing at the moment?

A: Bullish or bearish movements

Q: Where do you find this information? (Whether it is bullish or bearish)

A: Global Interest rates and commitment of traders.

Global interest rates are the “fundamental driver that sets the tone for the long-term price

movements. The commitment of traders shows you a visual representation of what smart

money is doing and is positioned periodically.

https://www.global-rates.com/en/interest-rates/central-banks/central-banks.aspx

https://www.barchart.com/

Q: How do you plan your analysis?

A: By looking at these two, you come up with a sell program or a buy program.

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How to Use These Two?

Step 1: Go to barcharts.com and find the currency you want to look at.

Step 2: Open the contract with the highest open interest. In this case it is September 2021

contract.

Step 3: Click at the interactive chart.

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Step 4: Click the +Study button on the chart, then type COT and add the COT indicator.

Close the small spec option and continue.

What are interest rate differentials?

-Interest rate differential refers to the difference between two countries' interest rates.

-On a central bank level, large flows seek yield/rate of return. This means that they would

want a currency with a higher interest rate.

How to Use This in Your Analysis?

Step 1: Find a currency with a high-interest rate and a currency with a low-interest rate. The

one with the higher interest rate would be expected to be bullish. In this case, USD is the

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one with the higher interest rate and the Japanese Yen is the one with the lower interest rate.

This is a bullish outlook for US Dollar.

Step 2: This is the Japanese Yen graph, the currency that is expected to be bearish. In Jan.

2021 the commercials (central banks) had an extremely bearish opinion about it and they

were positioned in shorts.

Step 3: Look at the currency with the higher interest rate. In Jan. 2021, US Dollar was

viewed as bullish by the commercials and they were positioned in long positions.

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Result: After the break in structure in January 2021 at the chart below, the algorithm starts to

reprice USD/Yen higher. Notice that this is a very huge up move.

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 Market Maker Series Vol. 2 of 5

Foundations to Institutional Orderflow & Understanding Liquidity

-To understand what the large institutions are doing, you should ask “What do I think the
weekly chart is going to do?”

-Look for obvious levels. If you see a level that is too clean, chances are that it is going to be
swept.

In the sell-stop situation above, there are different views by retail traders. Some think
that if the price trades below that level, they are wrong about their long idea and they short.
Some see the level as a support level and when it is broken, they also short. This is how
liquidity functions. These shorts function as a way for the constitutions being able to fill their
long positions.

-Look at the draw on liquidities.

-At the chart above, we expect the buy-side stops (1.3900s) to be taken out. Institution order
flow for the week should be bullish until we get up to that area. When the price reaches that
level, we can consider whether it will be a continuation or a reversal.

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 The closer you can buy to the opening price of the week, the higher probability it is
for your longs. Because, as we get closer to the draw on liquidity, we do not know whether it
will retrace or not. If I am bullish for the week, I am expecting Monday, Tuesday, and early
parts of Wednesday to be bullish, till we get to the draw on liquidity.

Notice how the price reacts at its low on Tuesday. It reacts to the Friday
candle. ICT defines it as a bullish order block. The market is already bullish, or the
underlying narrative is bullish. We had a confirmation that the market wants to go higher as
Monday was bullish. It is also a Judas Swing for the day. Retail traders get caught in the
lower timeframe and they short, however market reverses when the market reaches an HTF

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area. We expect the price to reach the draw on liquidity on Wednesday, however, it is not
necessary, because we were already profitable on Monday and Tuesday.

A high probability order block is when it takes out stops and returns to the order block
itself. Consider the chart above: The market is bullish, so down-closed candles that have a
market moving away from it and has a swing low residing just above will be a high probability
zone. In the chart above, your entry would be at the order block under the sell stops, stop at
the lowest of the close of the down-closed candles, and take profit at a level near the draw
on liquidity.

Each time that is a dynamic move up, a short-term low was taken.

-Institutionals will not buy at a higher price when they could instead be buying at a lower
price. Vice Versa.

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-London creates the low of the day, and New York creates a continuation.

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 ICT Market Maker Series Vol. 3 of 5

Market Structure, Key Levels & SMT

We assume that you have now the foundations for the quantitative analysis from the
previous parts. Now, you should have an underlying outlook on the markets whether it is
bullish or bearish. It is now time to learn qualitative analysis.

Imagine that you think that you expect a move that will take us down to a key level below.
What makes a key level is that it is a level that is on a monthly, weekly, daily, or 4h
timeframe. They are used by large fund traders in their analysis.

If you have that bias, you would expect the price to first move down, then reverse from the
key level that you identified to upwards, possibly to another key level. You can either be the
trader who shorts the initial move or the trader who longs the secondary move. Either way,
you will be profitable if your HTF analysis is correct. These lows can form in two different
ways.

Price makes a lower low, then makes a lower high,

then makes another lower low (which will be the
ultimate low on the higher time frame), then makes
a higher high. Then you can join the upwards
movement from the breaker formed.

The second way it can form a low is that it will form

a lower low, lower high, higher low, and higher
high. However, this can only be used if there is an
SMT divergence with a market that is closely
correlated with the market you are in. For example,
if this is the EURUSD graph, you would want the
first version to occur in the GBPUSD chart. This

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would be considered an SMT Divergence. This indicates that there is a strong disparity
between what the algorithm is pricing in for one currency versus the other. The logic is that
“All boats rise with the tide”.

MMXM Model

This is a very general model, it is subjective. There are rules and patterns for each of these
sub-parts of this model. However, this outlined idea will still be very useful. This is the
fundamental understanding of the MMXM Model.

1st Box: Original Consolidation. How much time the price should spend at this step is very
subjective. It may be different for different timeframes. Experience will give a better detection
of this consolidation. It is still the longest consolidation part of this model. Accumulation of
shorts.

Leaving the original consolidation: Price may give a return to the original consolidation. It
may not always happen. If it does, it should not spend much time at there, it should break
down violently. If it does not return to the original consolidation, it will form an optimal trade
entry setup.

2nd Box: Usually you will see an optimal trade entry or a run to the buy side liquidities
formed. Price does leave this please more quickly than the original consolidation.

3rd Box: Same as the 2nd. May not even happen.

4th Box - Smart Money Reversal: Price runs into the key level. Reverses according to the 2
models shown on the previous page. Avoid lows and reversals that are not obviously clear
and instead are “dull”.

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5th Box: If smart money traders do not buy at the reversal, they will buy at here. An optimal
trade entry setup will form.

6th Box: Same as the 3rd Box. Then the price may run higher above the original
consolidation. If it does, it will be violent.

There are two ways for the instutationals to engage with the price: 1st-Accumulate shorts in
all of the accumulation zones and cover all of it at the key level all at once. 2nd-Accumulate
shorts in the original consolidation. Then take partials as the price moves down.

This is the vice versa of the first model, MMSM (Market Maker Sell Model)

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Examples:

Look at the charts above and look for MMBM and SMT Divergence in the Smart Money
Reversal Area.

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 ICT Market Maker Series Vol. 4 of 5

Time & Price Theory

Daily Dividers: Vertical lines at the start of each day (00.00 at NY Time - you should
set your charts to NY time if you haven’t done so).

We know from the previous parts that GBPUSD is/was bullish for this week. Now, we
will look at the characteristics of each day. They may not always be true, but they are usually
true. We want to buy on these times.

If we are bullish: a 70% chance - low of the week will form on Monday, Tuesday, or by
Wednesday’s London session. In this chart, the price leaves a consolidation after taking the
sell-side. Is it really possible for the price to go below this consolidation if you are bullish?

We are only looking for the influence of the opening price and buying below or at it in
a bullish expected week on Monday, Tuesday, and Wednesday. If you are bullish, you want
to buy as close as possible to the opening price for the week. We are only looking for the
influence of the opening price and buying below or at it in a bullish expected week on
Monday, Tuesday, and Wednesday. Thursday and Friday tend to create the opposite end of
the weekly range for the week. You may miss some trades, but generally, it is good practice
to keep this in mind to keep your account safe.

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 Hourly Chart

Notice how buying below the opening price for the day in NY time is ideal. These are where
smart money accumulates its longs.

15m Chart

This example is mainly why ICT leaves Monday’s trading for everyone else. If you
establish a long on Monday, in this case, you may make the mistake of moving your stop to
the NY Low on Monday and then getting stopped out. Study Monday and get into action on
Tuesday.

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 OTE is associated with the time of the day. Set your time setting to NY Times.London
Killzone: 2 am to 5 am in NY time. NY Killzone is 7 am to 10 am. NY Session is 8.30 am to
11 am.

Time is important. Markets will not generally give you setups that pan out between
the two kill zones. It will usually be consolidation. After the NY session, the price will also
consolidate. For this example, the volatility on Wednesday after NY Session is FOMC. Don’t
trade FOMC volatility if you are a developing student. Check
https://www.forexfactory.com/calendar to be prepared for important events during the day
which might create volatility.

Time and price theory. Blend these two things to create a narrative that you want to
follow. Then, you want to see if the price follows this narrative.

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 ICT Market Maker Series Vol. 5 of 5

Daily Bias & Generic Market Macros

Monday- 5m chart

Price goes below midnight opening price. Takes out short-term lows. Check to see if
the price is willing to rally. Price rallies and takes out the short-term high. You want to buy
below the midnight opening price, so wait for the retracement. Price shows a clear sign of
displacement and forms equal highs before the NY session. In the NY session, the price
goes below a short-term low and goes to the OTE of the last short-term swing. Then, the
price rallies, and the high of the day is formed.

Tuesday - 5m chart

Remember that we already have a bullish outlook for the week. Price trades below
the midnight opening price and creates a Judas Swing. Judas Swing is a move that catches

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traders off guard and is a manipulation move opposite to the upcoming expansion move.
London forms the low, and then the price trades above the short-term high (structure shift).
NY takes out a short-term low and trades into OTE; then, the price again rallies way above.
London session end creates the high of the day. Don’t try to catch the actual high; try to
catch most of the expansion move.

Wednesday - 5m chart - FOMC Day

Price constantly takes out short-term lows and highs. Back and forth. No position is
safe. FOMC trades below the low of the day. This is called the Seek and Destroy Daily
Market Profile. There is constant manipulation throughout the day. Before the market has a
directional move that is strong in nature, whether bullish or bearish, anticipate a low/high
being taken.

Thursday - 5m chart

We do not factor in the midnight opening price because we are so late in the week.
We look for it on Monday, Tuesday, and Wednesday in a bullish or bearish week. London
creates a strong upward move and goes back to OTE into 5m fvg, then rallies up.
Consolidates, and there is nothing special for the NY session.

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 Friday - 5m chart

Price trades to equal highs and Thursday’s high in London. We have pressed every
single day higher. The algorithm will likely trade back into the weekly range. Market shifts
after Thursday's high raid. Trades back to the order block formed, and it is downhill from
there. We go back to the initial weekly high target and return back to that area to
consolidate.

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