How Does Intraday Order Flow Work? | 2022 ICT Mentorship Episode 5

TL;DR

Intraday order flow is understood by organizing the daily range and intraday layouts, then studying recurring market profiles on a 15-minute chart. In 2022 ICT Mentorship Episode 5, the framework targets E-mini S&P, NASDAQ, Dow, and Russell 2000 index futures, with attention to contract expiration and open interest. Read on for the session framework, contract-selection rules, and key times to monitor.

Transcript

all right folks welcome back this is the 2022 ICT mentorship on YouTube and this lesson is going to be intraday order flow and understanding the daily range all right folks we're looking at tradingview.com and you can can use this platform for free uh there are some benefits to having a membership there it's not terribly expensive b... Read More

Key Insights

• Intraday order flow is crucial for understanding daily market movements.
• TradingView is a recommended platform for chart analysis.
• Index futures like S&P, NASDAQ, and Dow have specific trading months: March, June, September, and December.
• Open interest helps identify the most liquid contract month for trading.
• Fair value gaps are patterns that repeat and indicate potential trading opportunities.
• The morning session typically has a significant move, followed by a less active lunch hour.
• Afternoon sessions often see trends continuing or reversing from the morning.
• Swing highs and lows prior to 8:30 AM and 1:30 PM are key for identifying potential stop hunts.

Questions & Answers

Q: How does 2022 ICT Mentorship Episode 5 explain intraday order flow?

The lesson frames intraday order flow around setting up the daily range, arranging intraday layouts, and studying daily market profiles. It asks traders to examine recurring phenomena on a 15-minute chart before moving on to bias and specific entry techniques.

Q: Which markets does the intraday order-flow framework target?

The lesson directly targets index futures, including the E-mini S&P, E-mini NASDAQ, E-mini Dow, and Russell 2000. It says ideas such as trading the Asian range are not applicable to these markets within this mentorship framework.

Q: Which contract months trade for E-mini index futures?

The E-mini S&P, E-mini NASDAQ, and E-mini Dow trade four delivery months: March, June, September, and December. Their month codes are H for March, M for June, U for September, and Z for December.

Q: How do you select the correct futures contract month?

Start monitoring open interest around the first or second day of the week before expiration. Trade the current or next contract month that has the larger open-interest number because the lesson prioritizes the contract with the larger liquidity pool.

Q: When do E-mini index futures contracts expire?

The contracts expire on the third Friday of their delivery month. The lesson warns against trading a contract after expiration and describes the week before expiration as the period for monitoring whether liquidity has shifted to the next month.

Q: What do front month and next month out mean?

The front month, also called the current or nearby contract, is the nearest available delivery contract. The next month out is the contract month immediately following that front month.

Q: How can Barchart.com help with futures contract selection?

The lesson suggests opening the free commodity list on Barchart.com and selecting the S&P 500 E-mini. After skipping the cash listing, compare the available contracts and their open interest to identify the more liquid contract month.

Q: What should traders study before learning entries and daily bias?

The lesson asks traders to first learn the intraday framework and begin thinking about market profiles. Homework and study time are presented as the way to recognize recurring phenomena, while bias and specific entry techniques are reserved for the following week.

Summary & Key Takeaways

• Intraday order flow involves understanding the daily range and market profiles to make informed trading decisions. Key insights include the importance of trading during specific times, monitoring open interest, and recognizing patterns like fair value gaps.

• Index futures like S&P, NASDAQ, and Dow have specific trading months, and open interest helps identify the most liquid contract month. The morning session typically has a significant move, followed by a less active lunch hour.

• Afternoon sessions often see trends continuing or reversing from the morning. Swing highs and lows prior to 8:30 AM and 1:30 PM are key for identifying potential stop hunts, allowing traders to better navigate the market.