Algorithmic Orderflow

Question 1

What concepts should I look when determening Order Flow?

Answer 1

• Macro Interest Rates
  
  • Pairing up global interest rates, strongest against the weakest
• Seasonal Tendency
• Buy Or Sell Program
• Short Term Bias
• State Of Delivery

Above listed are what ICT is generally looking at when he is watching the market price. When looking at intraday or even 5min considering this process.

Question 2

What should I look on the Seasonal Tendency?

Answer 2

Determine when there is bullish seasonal and when there is bearish seasonal. Basically whne is there really one directional Seasonal tendency.

Question 3

HOW DO I know if the Institutional Order flow is Bullish?

Answer 3

I look at up close candles and are they being traded thru with no effort if bearish OBs are being traded to the upside and down close candles that would be +OB is is supporting price and sending price higher. IF I see this two signatures then the Institutional Order flow is bullish.

Question 4

What does it mean the state of delivery is on buyside?

Answer 4

Candles are expanding to the upside with the expectation to run into the levle sof Buy Side Liquidity.

Question 5

What does it mean when state of delivery changes to sell side while HTF Is bullish?

Answer 5

State of delivery is on sell side as price is expanding lower. It is reaching for Sell Side Liquidity that would be resting lower in price.

When I have change in state of delivery meaning I have buy side delivery first and then it CHANGES in state of delivery into Sell Side delivery BUT it is OPPOSING my HTF direction THAT Is where opportunity is born.

Question 6

Where is opportunity born?

Answer 6

When there is change in state of delivery into opposing direction as my HTF is suggesting.

Change in State of delivery it will be a small fractal pattern that I need to focus on. Once change in state of delivery occurs in the opposite direction as HTF is suggesting run the PD array matrix on the active dealing range and anticipate price trading lower to refil any imbalance or tap into the Key PD array and then continue trading in the intended direction.

Question 7

What is IOF?

Answer 7

IOF is the underlying direction of inflows at the Institutional level orders. It is the highest probable direction of delivery in Price…. on the majority of near term candles.

Question 8

When will IPDA look to generate Big Price Runs?

Answer 8

IPDA will look to initiate BIG BIG Price Runs when the IOF is Directional and when the State of Delivery has changed into opposing Order Flow.. at a Key PD array.

Question 9

Where am I anticipating price to pause or go into consolidation?

Answer 9

• At the EQ of the dealing range
• At the Key Level on the HTF.

Question 10

What can dealing range tell me?

Answer 10

Dealing range is determined by the high that most recently took out buyside liquidity and the low that most recently took out sellside liquidity.

SM will be allowed to sell in premium of the dealing range and it wil be allowed to buy in discount of the dealing range.

Question 11

How should I grade my Price Swing?

Answer 11

If I am bullish frame it from the low where the price swing started and the high of the graded price swing should be the PD array that I am targeting.

Question 12

If price is bullish on HTF and it comes back to the bullish BRK & BISI what is occuring?

Answer 12

When price comes back in contact with the bullish breaker it is also filling up the Imbalance and then it changes it state of delivery.

What is it changing to? It is changing it state of delivery to the Buy Side delivery.

Price is mitigating at that price point because breakers are mitigation. Anything that was held short and was not taken off prior to price run higher. Institutions will be allowed ot mitigate that loss to reduce the overall expousure of the risk.

Once the level is hit I can anticipate price continuing in the intended direction.

It is the same case occurring on M1 once I know the DOL.

Question 13

What can occur at 25% swing grade while HTF is bullish?

Answer 13

Once price trades into the HTF Key level and at 25% swing grade I am NOT anticipating for price to colapse lower. I am looking at that price level and 25% swing grade and anticipating re-accumulation.

Question 14

What is occuring when price forms the BISI and then trades back into it?

Answer 14

Buyside delivery only - forming the BISI - price will in future change it state of delivery to Sellside delivery only to trade back into BISI (where it was only Buyside delivery).

It is a change in state of delivery what is where the opportunity forms Algorithmically

Always think about the paint roller analogy. PRice is only offered on upside (BISI) but at some point it will have to come back to rebalance the area where there was no sell side delivery. Exactly this is occurring as price is returning back to BISI.

Once price rebalances the BISI that Change in State of delivery sets up a opportunity for Buying, because it has filled in a imbalance.

Question 15

What can occur after price takes out a STH in regards to CSD?

Answer 15

Price traeds above the STH and then it has change in state of delivery.

What is it going? Offering Sell Side delivery coming back down. It will look to trade lower to rebalance any imbalances or inefficiencies in price. Rebalance and then continue trading higher.

So when price wicks above the STH and changes it State of delivery to sell side delivery it is running back to old area of orderflow. Which is the last down close candle before price took out the STH and it is a propulsion candle.

Question 16

Which Imbalances in regards to graded price swing are most likely going to stay open?

Answer 16

At the 50% of the potential swing grade I am forecasting this is generally where price is going to consolidate - it can consolidate longer than it did at Original Consolidation.

At about 50% level there I am usually going to see a run on stops and If there is a Imbalance they tend to stay open.

Why would the Imbalance want to stay open? Because it acts like a breakaway gap or measuring gap AND they are better to stay open and not rebalance. This one should be left open.

Now if there is NO Imbalance at 50% level and there is a STL then I can anticipate priec si most likely going to drop below the STL and that would be a buying opportunity. Ideally taking out a STL and trading into PD Array.

Any Imbalances close to 50% of the graded price swing will tend to stay open.

Question 17

What should generally occur at 75% graded price swing?

Answer 17

There is usually NO STOP HUNT at the 75% swing grade price should just simply rally higher into the HTF Objective.

75% price swing price should just rally into the HTF PD array anticipating no STOP HUNT.

BUT IF THERE IS A STOP HUNT I can buy that swing low and then anticipate price trading into the PD array but it might fail to get there, depends from the HTF.

Question 18

Sum up the importance of 25%, 50% and 75% graded price swing

Answer 18

• 25% I can anticipate buying opportunity at a key PD array
• 50% usually consolidaiton and Imbalances tend to stay open, some kind of stop hunt usually
• 75% tends NOT to have a stop hunt and it tends to just run into the PD Array. Tends to create some type of OTE entry. If some sort of ITL or ITH tends to get broken at this grade I can anticipating for the market to have a deeper retracement before taking out the objective.

Question 19

What are the key concepts that I should I look at when considering the hange in state of delivery.

Answer 19

Institutional Order Flow (IOF): The trader gauges bullish sentiment by observing the break of bearish order blocks (OBs) and the breaking of previous day (PD) arrays, which indicate a bullish order flow.

Market Maker’s Model (MMXM): When clear MMXM patterns are not visible, the trader refrains from trading and instead looks for simple price swings that are graded based on liquidity runs.

Graded Price Swings: The strategy involves assessing price swings at key levels—25%, 50%, and 75% grades. Each level has its significance:

25% Level: Forecasting buying opportunities.
50% Level: Often a zone of consolidation and potential imbalances. If imbalances are left open at this level, they may act as breakaway gaps, and the trader may anticipate a stop hunt. If price trades into an imbalance at this level, it could be an opportunity to buy.
75% Level: Typically, there is no stop hunt, and the price may consolidate or present an Optimal Trade Entry (OTE) pattern before quickly moving to the target. Aggressive stop loss management is required if a stop hunt occurs after reaching this level.
MMBM andMMSM: If neither the Market Maker Buy Model (MMBM) nor the Market Maker Sell Model (MMSM) is apparent, the focus shifts to graded swings for trading decisions.reference point and is the primary focus at the start of trading, as it can influence the direction of trades.s with the identified bullish or bearish bias. It also considers the nuances of algorithmic order flow, which can be observed across all time frames.

Question 20

What should I determine first when sitting in front of the charts?

Answer 20

it is the DOL - Draw on Liquidity or where price should trade NEXT.

Question 21

Which what stage of IPDA does Buy and Sell Program start?

Answer 21

Everything starts with consolidation.

Question 22

Regards to Premium and Discount where do I want to be a buyer?

Answer 22

For me to be a buyer I want to see price come back to at least discount of the range. Meaning to the EQ or below EQ-

At EQ or in discount While HTF is bullish I could be a buyer.

Look below the EQ and identify the key HTF PD arrays.

Question 23

What is three indians pattern?

Answer 23

It is a High Resistance Liquidity Run pattern. Price will for example make higher highs in order to accumulate more shorts above the highs and then it should trade lower.

HRLR is paired with delayed delivery.

Question 24

What is displacement?

Answer 24

Price offering buyside delivery into the buy side liquidity are this means there was only buyside delivery offered and that is displacement.

Inside the displacement there was only buy side deliver ymenaing there was no opportunity for the sellers to sell at a lower price and it was all just buy side delivery.

Question 25

How will price engineer sell side liqudity above a key PD array?

Answer 25

Price will drop lower and start consolidating at or just above the Discount PD array. SM will hold price in consolidation for orders to build up below and above the range.
Once enough orders have been build market makers drive price lower into the key PD array and taking out the STL for more buying. Price will then change it state of delivery from sell side delivery to buy side delivery.

ALGO will pause at some point to give SM traders opportunity to pile in the market. When I see those little runs higher and lower not breaking anything. Stop Loss orders are going to pile under the lows and above the highs. And Sell Stops at cosnolidation lows are exactly the lows that SM wants to see at Imbalance (key PD Array). Algo will then make a agressive run lower for the sell side liquidity offering opportunity to the traders that know what they are looking for on institutional level to buy at that level. That drop lower will also most likely be rebalancing some kind of imbalance.

Question 26

What is occuring as price drops lower into the key PD Array and Rebalancing a FVG (BISI) while HTF is bullish?

Answer 26

Market goes down into old area of buy side only delivery (BISI) while it is acting as sell side delivery. There is Change in a state of delivery in price where it was offered as Sell Side into an are where it was previously only offered on Buy Side while the narrative is bullish.

*Price will want to come back into the BISI for efficient delivery. Once that is over then it runs higher for the External range liquidity (Buyside Liquidity)

*Algorithm is programmed to make a run lower below the consolidation low BECAUSE breakout traders are going to enter SHORT once the consolidaiton low is broken. That is simply a stop hunt on those and SM is allowed to buy more.

*After the BISI has been rebalanced price should continue trading higher.

Question 27

What will algo do once price reaches the HTF Key Discount PD array?

Answer 27

1. It will go into consolidation so SM can already start entering the market and for Sell Side Liquidity to build up below the consolidation lows (engineering liquidity)
2. Algo will eventually drive price lower with expansion below the Consolidaiton lows to accumulate Sell Stops and it also drops into old area of inefficient Order Flow (BISI). In that run lower below the Consolidation low and into key HTF PD array that is where SM is buying.
3. Algorithm is programmed to make a run lower like this because some breakout traders are going to enter short and run lower is simply to fake them out and allow SM more buying.

*After the BISI has been rebalanced price should continue trading higher.

Question 28

Is algo aware how many orders are there in the market place?

Answer 28

Algo is really not aware of how many sell orders are there below the lows he just knows the human psychology.

Question 29

What is delayed delivery?

Answer 29

Delayed Delivery is going to be paired with HRLR. There is going to be a lot of back and forth price action before price is going to clear out the HRLR highs or lows.

Price is going to be met with a tug of war while it would be trying to be breaking thru the HRLR -> anticipate a lot of choppines.

Question 30

When price makes a run higher and then starts to retrace what should I focus on?

Answer 30

When price makes a run higher and then it starts to retrace lower back into the discount of the range, I immediately have to look for the Imbalance because that is the reason why price is going LOWER? (GOING LOWER for the reason of rebalancing)

OR it is going lower for SSL internal short term swing low. Wel

Price is only going to move because of two things: Liquidity - old highs & old lows AND Imbalances - inefficiencies.

Question 31

How does CSD look at the BISI?

Answer 31

Well if there is a BISI and price comes back into it to rebalance. There is a change in state of delivery. There is a BISI noted and then price DROPS down into it and the fact that it drops DOWN into it there is a Change in State of delivery.

Sellside delivery of price into Buyside Imbalkance htat is WHEN the algorithm will reprice and go higher. Wicks can overshoot the BISI or Imbalance in general but Bodies should stay inside of it.

*Wicks on a cnadle CAN overshoot the Imbalance but I have to understand that wicks are purely connected to the brokers. BODIES of the candles are representing the Institutional Order Flow and they should be closing inside of the Imbalance. Same goes with other PD Arrays.

Question 32

When do FVGs expire?

Answer 32

FVGs DO NOT expire unless they are outside the IPDA Data range. ICT stops looking for FVGs after they are outside the 60 days IPDA Data Range.

ICT generally does NOT like to look at the PD arrays outside the scope of 60 trading days.

Question 33

WHERE will change in state of delivery occur?

Answer 33

The delivery is going to change it state for example from sell side delivery to buyside delivery when it enters old are of sell side delivery (OB). That is then efficiently balanced. That means at that moment that is when I anticipate the ALGO will most likely change gears.

Question 34

Can SM hide peaces of the puzzle away from me?

Answer 34

SM can not hide the peace of the puzzle away from me. When I understand when state of delivery overlaps with previous state of buy side and it offers it into sell side. As it is trading down, every retail book tells nothing about buying. When looking at indicator there is usually going to be a bullish divergence and that is when they work but it is not because of divergance it is because of delivery in price. Delivery in price controls everything and it is hindged on time and price.

Question 35

What is going to be initial sign of price that it wants to go higher after consolidation?

Answer 35

I am looking for the initial displacement higher and it is also a dealing range.

In the dispalcement price changes it state of delivery to buy side delivery. Once it starts dropping lower (retracing) the state of delivery is on sell side.

I wait for price to trade back to imbalances and see if they offer any energetic reaction in price higher. If NOT then I simply wait for price to trade lower back to bullish OB.

Question 36

What is my framework after the initial displacement higher and HTF is bullish?

Answer 36

State of delivery is on buy side (displacement higher) and then it changes to sell side (retracement) WHILE i have a bullish context.

My framework is that I have to watch the last down close candle if there is NOT going to be any sensitivity around the Imbalance.

Think about paint roller analogy. Paint is applied and then it comes back lower into old are of Institutional Order Flow.

Question 37

What if Price comes back into BISI while HTF is bullish and there is ZERO sensitivity?

Answer 37

If price comes back into BISI and there is ZERO sensitivity or the reaction away is very lathargic.

*Ideally I want ot see a dynamic reaction where the algo is showing that It wants to trade away from it higher.

If I see a “lathargic” move away from the BISI then there is still a chance for price to come back into the OB to rebalance it and then continue higher -> meaning focusing on the last down close candle (+OB) and then I anticipate the algo to start spooling and mowing towards Buy Side Liquidity.

Question 38

When will old highs work as resistance broken turned support?

Answer 38

When old high is broken with an Imbalance I can anticipate the old high that was broken with Imbalance to act as resistance broken turned support.

Question 39

Once price breaks the old high what do I need to ask myself?

Answer 39

Once price breaks old high I have to ask myself what has price done prior to breaking the old high AND what IPDA needs to do to reprice efficiently.

You always look at all of this PA that is below BSL. ask youself what has price done. What IPDA would need to do to reprice efficiently.

Question 40

Which PD arrays are higher importance and which PD arrays is the most dominant out of them all?

Answer 40

• The most dominant PD array is the Breaker
• Any PD array with FVG is stronger PD array.

Question 41

Which swing highs and swings lows are going to be more important?

Answer 41

Swing lows and swing highs that rebalance a FVG they are going to be of bigger importance and price is going to tend to stay away from them.