🥷 Welcome to Episode 6 of my series "DECODING THE ALGORITHM"🤖. In...
Will Street@WillStreet_fx
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Dec 11, 2024
~4 min read
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🥷 Welcome to Episode 6 of my series "DECODING THE ALGORITHM"🤖.
In this chapter, I’ll dive into the most important candle of the day, the 0500 candle.
This is not a simple candle; it reveals more than you could ever imagine.
A thread 🧵
💎💎
In this chapter, I’ll dive into the most important candle of the day, the 0500 candle.
This is not a simple candle; it reveals more than you could ever imagine.
A thread 🧵
💎💎
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🧠 Before we jump in, if you haven’t checked out the first five episodes yet, I highly recommend giving them a look.
In previous chapters, I covered:
• Episode 1: Previous candle purge
• Episode 2: Time-Based Entries
• Episode 3: Failure Swings
• Episode 4: The logic behind my entries
• Episode 5: WS Continuation Model
Each episode is key to understanding how the algorithms work and enhancing your strategy. Don’t miss out!
🧠 Before we jump in, if you haven’t checked out the first five episodes yet, I highly recommend giving them a look.
In previous chapters, I covered:
• Episode 1: Previous candle purge
• Episode 2: Time-Based Entries
• Episode 3: Failure Swings
• Episode 4: The logic behind my entries
• Episode 5: WS Continuation Model
Each episode is key to understanding how the algorithms work and enhancing your strategy. Don’t miss out!
Will Street@WillStreet_fx
🥷 Welcome to CHAPTER 5 of my series "DECODING THE ALGORITHM" by Will Street.
In this chapter, we’ll dive into my WS CONTINUATION MODEL, crucial for not missing any moves that have already started🥷🏼 .
If you want to learn how to maximize every opportunity in the market, stay tuned and keep reading this thread!
🧵👇
In this chapter, we’ll dive into my WS CONTINUATION MODEL, crucial for not missing any moves that have already started🥷🏼 .
If you want to learn how to maximize every opportunity in the market, stay tuned and keep reading this thread!
🧵👇
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Now, let’s dive into today’s topic: the 5AM candle. Why is it so important? For the algorithm, the 5AM candle divides the London and New York sessions, marking what I call the “London Lunch” session.
As the midpoint of the day, it also serves as an indicator for predicting price movements for the rest of the day and setting the profile for the next session.
Additionally, it helps with entries and exits, as every entry is also an exit and vice versa. The 5AM candle plays a key role in changing the state of price delivery (CISD), which we’ll explore shortly.
Now, let’s dive into today’s topic: the 5AM candle. Why is it so important? For the algorithm, the 5AM candle divides the London and New York sessions, marking what I call the “London Lunch” session.
As the midpoint of the day, it also serves as an indicator for predicting price movements for the rest of the day and setting the profile for the next session.
Additionally, it helps with entries and exits, as every entry is also an exit and vice versa. The 5AM candle plays a key role in changing the state of price delivery (CISD), which we’ll explore shortly.
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Why is the 5:00 candle so important? Price is represented by candles, and the 5:00 opening combines the start of several high-time frame candles: 12-hour, 6-hour, 4-hour, as well as 3-hour and 1-hour.
This is scheduled, it will happen EVERY SINGLE DAY.
Why is the 5:00 candle so important? Price is represented by candles, and the 5:00 opening combines the start of several high-time frame candles: 12-hour, 6-hour, 4-hour, as well as 3-hour and 1-hour.
This is scheduled, it will happen EVERY SINGLE DAY.
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With so many new candles opening simultaneously, and since price seeks to mitigate highs and lows, we can capitalize on this mitigation of the 5:00 candle to exit our trades during the London session. 🚀
With so many new candles opening simultaneously, and since price seeks to mitigate highs and lows, we can capitalize on this mitigation of the 5:00 candle to exit our trades during the London session. 🚀
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When trading London, the 5:00am candle helps determine whether price will continue its current trend or reverse. This candle acts as a pivot point for strategies, allowing us to adjust positions ahead of the New York session.
Here are some real examples: we use the WS Time-Based Entry Model or the WS Continuation Model to enter trades, then wait for the 0500 candle to take the 0100 high/low to exit.
When trading London, the 5:00am candle helps determine whether price will continue its current trend or reverse. This candle acts as a pivot point for strategies, allowing us to adjust positions ahead of the New York session.
Here are some real examples: we use the WS Time-Based Entry Model or the WS Continuation Model to enter trades, then wait for the 0500 candle to take the 0100 high/low to exit.
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If you’re trading New York, the 5:00am candle helps identify whether price will continue or reverse. It also encapsulates the 8:00 candle, often tied to major New York news releases. This means this candle will likely be an expansion. Positioning ourselves during the 5:00 candle lets us anticipate movement during the 8:00 candle when major news drops. 🗞️
Which hours are impacted by the 5AM candle?
The 5AM, 6AM, 7AM, and 8AM candles. The 7AM candle occasionally includes key GBP interest rates, and New York news releases frequently occur at 0830, with an exception for ADP news at 0815 the first Wednesday of each month.
This indicates that the 5AM candle expands 70% of the time during the week. Knowing this allows us to position optimally within this candle.
If you’re trading New York, the 5:00am candle helps identify whether price will continue or reverse. It also encapsulates the 8:00 candle, often tied to major New York news releases. This means this candle will likely be an expansion. Positioning ourselves during the 5:00 candle lets us anticipate movement during the 8:00 candle when major news drops. 🗞️
Which hours are impacted by the 5AM candle?
The 5AM, 6AM, 7AM, and 8AM candles. The 7AM candle occasionally includes key GBP interest rates, and New York news releases frequently occur at 0830, with an exception for ADP news at 0815 the first Wednesday of each month.
This indicates that the 5AM candle expands 70% of the time during the week. Knowing this allows us to position optimally within this candle.
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Let’s explore a real example using the 4-hour chart to split the 5AM candle.
By identifying where the DOL lies, we position ourselves in the optimal zone of this candle.
The optimal zone is below the open (if bullish), after mitigating HTF candle (0100 - London low), using the WS Time-Based Entry Model (at 0600). For subsequent candles, the WS Continuation Model is used until the target is met (0700 and 0800 candles).
Let’s explore a real example using the 4-hour chart to split the 5AM candle.
By identifying where the DOL lies, we position ourselves in the optimal zone of this candle.
The optimal zone is below the open (if bullish), after mitigating HTF candle (0100 - London low), using the WS Time-Based Entry Model (at 0600). For subsequent candles, the WS Continuation Model is used until the target is met (0700 and 0800 candles).
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By comparing the 5:00 candle to the 1:00 candle, we can forecast 0900 candle behavior by understanding price delivery states and identifying the next session profile: consolidation, expansion, or reversal.
Examples show how the 0100 candle’s action and the 0500 candle’s behavior can anticipate expansions, reversals, or consolidations at 0900.
By comparing the 5:00 candle to the 1:00 candle, we can forecast 0900 candle behavior by understanding price delivery states and identifying the next session profile: consolidation, expansion, or reversal.
Examples show how the 0100 candle’s action and the 0500 candle’s behavior can anticipate expansions, reversals, or consolidations at 0900.
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As mentioned, when trading New York and anticipating 5:00 candle continuation (either bullish or bearish), we aim to position ourselves at the Power of 3 within the 5:00 candle to capture 8:00 candle momentum driven by news. ⚡️
Here’s an example from November 14th, showing how I traded London and New York moves.
The 5AM candle marked my profits and re-entry, anticipating continuation and expansion during the New York session.
Since the 8AM candle didn’t reach my Draw On Liquidity, the 9AM candle continued, applying my Continuation Model.
As mentioned, when trading New York and anticipating 5:00 candle continuation (either bullish or bearish), we aim to position ourselves at the Power of 3 within the 5:00 candle to capture 8:00 candle momentum driven by news. ⚡️
Here’s an example from November 14th, showing how I traded London and New York moves.
The 5AM candle marked my profits and re-entry, anticipating continuation and expansion during the New York session.
Since the 8AM candle didn’t reach my Draw On Liquidity, the 9AM candle continued, applying my Continuation Model.
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🥷Now, it’s your turn.
I’ve broken down the 5AM candle, but imagine decoding every candle of the day to anticipate and capitalize on each move using similar principles across sessions. There’s more to uncover, study deeply!
🥷Now, it’s your turn.
I’ve broken down the 5AM candle, but imagine decoding every candle of the day to anticipate and capitalize on each move using similar principles across sessions. There’s more to uncover, study deeply!
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Closing:
The 5AM candle is highly versatile, adapting to different sessions and trading styles. Use it wisely.
For more insights, like, retweet, and share! 💡
Att,
🐺
Closing:
The 5AM candle is highly versatile, adapting to different sessions and trading styles. Use it wisely.
For more insights, like, retweet, and share! 💡
Att,
🐺