HOW TO TRADE SMC

Market Analysis Using Smart Money Concepts

Overview

• Asset: US 100 Cash CFD
• Timeframe: 5-minute chart

Current Market Structure

• Trend: The market is exhibiting a clear downtrend characterized by lower highs and lower lows, indicating that sellers are in control.

Key Levels

1. Order Blocks (OB)

• Daily OB: Located near the top of the chart, this area represents institutional interest for potential buying. Watch for price action around this zone as it may indicate a reversal.
• 5-Minute OB: Close to the current price action, this order block is essential for identifying short-term buying opportunities if the price retraces.

1. Fair Value Gaps (FVG)

• There are two identified FVGs:
• FVG at the lower levels: This gap may act as support as price pulls back, providing a potential area for price discovery.
• FVG in the middle range: This may attract price back to fill where there was a fast movement away from, offering more trading opportunities.

1. Liquidity Areas

• Upside Liquidity: The marked area indicates potential targets where price may seek liquidity, likely above resistance levels.
• Observing where buy orders (liquidity) are accumulated can provide insights for potential reversals or continuations.

Entry and Exit Points

• Buy Entry: Consider entering long positions if price approaches the 5-minute OB and shows signs of reversal (e.g., bullish candlestick formations).
• Sell Entry: Look to enter shorts if price fails to hold above the daily OB and begins to show bearish momentum.
• Targets: Set profit targets at FVG levels and structural highs/lows,