Targets-LIQUIDITY

The Banks (and large financial institutions) trade much, MUCH differently than retail traders (the rest of us). They can’t just hop on their phone and place a $100,000,000 trade. So they HAVE to trade a certain way.

That’s because when someone places a trade there has to be someone on the opposite side. If you want to buy 5.0 lots, there has to be someone (or multiple people) that are selling 5.0 lots.

Well, there’s never going to be enough lots (liquidity) readily available to fill a $10mil, $100mil, or even $Billion dollar order. That size order would take so long to fill they would end up losing tons of money. And that’s if they didn’t just flat out crash the market by trying to do this.

So they have to CREATE that liquidity in the market. Since they are the literal market movers they do this by creating scenarios that pull in retail traders in.

As we explain on our TRADING INSIGHTS page, retail traders, who have a 96% failure rate, trade certain ways. They look for certain situations and certain patterns and they trade each of those in a specific way. Support; Resistance; M & W patterns; Tea Cup patterns; etc.

The banks create these patterns to pull in retail traders, then they move the market however they need to in order to cause all these retail traders to hit their stop losses.

When you hit your Stop Loss you’re forced to close your position. And since every seller needs a buyer, The Banks are more than happy to take those positions off your hands at a discounted price.

THIS is how they are able to fuel their huge moves and THIS is how they win all the time.

We will show you some examples of this on this page here.

We'll add to and update this page as often as we can with new situations to break down for you to see

We also have plenty more examples on our TRADE UPDATES page

USING YOUR MONEY TO FUEL THEIR HUGE, PROFITABLE MOVES

That BIG move down to hit those targets, that was probably hundreds of millions of dollars in profits for them. AND it was to eliminate probably hundreds of millions of dollars in DrawDown from past orders. So they won big on both ends.

But that big move down can't just happen at any time. It took weeks of setting up. And that's what all that "bouncing around" was for the past few weeks.

That big move down to hit those targets required probably tens, if not hundreds of millions of dollars worth of SELL orders. Since the Forex Market is a zero sum system, for every buyer there has to be a seller and vice versa.

So in order to make that big move down there needed to be tens-hundreds of millions of dollars worth of orders for the banks to pick up. But that's just not going to happen. There's never going to be tens-hundreds of millions of dollars just sitting there.

And if the banks tried to trade like we do and just hop on their MT4 and try to enter that large of a trade, they would basically crash the market.

So they need a sufficient amount of liquidity in the market that will be available for them to use to fuel these huge orders to make that big push down.

And that is where RETAIL TRADERS (you / us) come in.

Make no mistake about it. The banks are the top dog, apex predators in this system and retail traders are the prey. They are the food source. All that money the banks make every year - hundreds of millions - BILLIONS of dollars...where do you think it comes from?

So you better believe these apex predators know EXACTLY how their food source thinks and acts. So they know EXACTLY how to hunt them. How to bait and trap them.

PRICE ACTION - BAIT

All this price action. This is all bait. Because they know their prey. Retail traders have no patience. They want to get in. They want to play. They want action. They want to make money. They want to try their new indicators and EAs and new strategies they just learned.

And most of all, they know retail traders mostly all have FOMO, all the time (Fear Of Missing Out). All this price action. All these quick, big moves one way then back the other way. All this ACTION, it's just too much for retail traders to resist.

Every single move the price makes pulls in more traders. Because every move that is made there are traders that KNOW what's happening so they want in. So they start making their trades. Putting money into the market.

THEY KNOW WHAT YOU'RE GOING TO DO BEFORE YOU DO

Like I said, the banks know everything you're going to do. They know how you're taught to trade and they know how you think. They know where you're going to BUY and where you're going to SELL and they know where you're going to have your Stop Losses.

For example, they'll create these areas of "support" because they know retail traders are taught to put their Stop Losses BELOW the support because they think somehow that invisible line that really means nothing is actually part of the market structure and will have some bearing on if the price goes below it or not (it does not).

THE TRAP IS SPRUNG AND THE PREY ARE EATEN

So after a few weeks of all this tempting price action and weeks of pulling in retails traders....the banks NOW have the liquidity they need readily available for all those HUGE SELL orders they need to bring the price down to those targets.

They bring the price down hard and fast, blasting through all those "support" areas, blasting through all those Stop Losses, forcing those BUYers to close their positions...positions which are now available (so to speak) for the banks to pick up and fuel that move down.

What we have here, which began with the 530am (PST) USD news this morning, is a textbook move by the banks and if you know what you're seeing then you know what they're doing and where they're going.

In the last update we explained how the banks have to create liquidity in the market to fuel their moves. I'm going to show you exactly how they take that liquidity now.

Looking at a chart you can see where the liquidity is. Liquidity is basically pockets of money sitting there from BUY & SELL orders.

Looking at this chart you can see where that liquidity is sitting. But the problem is, that liquidity is tied up in BUY and SELL orders. In order for that liquidity to be available for the banks to scoop up, those BUYers & SELLers need to close their positions.

Luckily for the banks, BUYers and SELLers are going to have their Stop Losses and pending orders in predictable areas.

Once there is enough liquidity sitting there, the banks start making their moves.

MOVE #1

Jam the price down to take out the BUYers (cause them to hit their Stop Losses).

MOVE #2

Bring the price WAY up, taking out the SELLers (hitting their Stop Losses).

And JUST LIKE THAT they wiped everyone out and scooped up all that liquidity (took everyone's money).

HOWEVER, those SELL orders they opened in the first move to bring the price down, those are currently in DrawDown. Now, the banks aren't exactly keen on losing money. So what do they do?

MOVE #3

Bring the price back down to mitigate those losses (get their money back / break even).

Oh, and while they're at it, all those pending BUY orders they triggered with that second move up, they just took them out too on this 3rd move down.

FINAL MOVE

Now that they just took everyone's money they have what they need to fuel their MAIN MOVE - in this case UP to the next nearest targets which are LARGER order blocks they've had in DD since mid January as well as some Imbalanced Price Action.

9 times out of 10 they would head up anyways. They could head down just the same. But either way, it's easy to follow.

That's really all the Forex Market is - a big game of the banks constantly moving the price around to collect money in one way or another. But if you know what they're doing and how they play the game then you know where they need to go. So you pick your spots and go along for the ride. Collect some of that money for yourself.

Again, nothing is ever a guarantee and the price can do anything at any time. But this is a move that happens ALL THE TIME so it's very LIKELY this is how it will happen.

But if the price goes beyond that order block of SELLs there, then it's going to head down to some lower targets.

But if it DOES head up then we know where it's going. And if it's still in a DOWNTREND overall then it will turn around before it breaks that last DAILY peak and we know where it's headed.....WAAAAY down.

So no guarantees.... but TONS of potential!

Just a reminder that NOTHING is ever guaranteed, and prices can do anything they want at any time. We can only ever make an educated estimation of what is LIKELY to happen. But rest assured even if things don't go as planned there is always a contingency plan.