Learn how to filter out fake signals in trading with three smart money indicators: fractal break and balance, fluid trades, and order blocks with signals.
How to Use Smart Money Indicators to Generate Accurate Trade Entry Signals
Introduction
In this video, I will share with you a strategy that is based on three smart money indicators that can help you generate accurate trade entry signals. With these indicators, you can filter out fake signals generated by any strategy. This strategy will help you find better and smarter trade entries in the crypto and stock market.
Indicator 1: Fractal Break and Balance Indicator
The fractal break and balance indicator is designed to identify and draw out imbalances on the chart that are created by fast price movements. Imbalance in forex trading is a situation where there is a significant difference between the amount of buy orders and sell orders for a particular currency pair. This imbalance can lead to a rapid increase or decrease in the price of the currency pair, making it difficult for traders to predict the future direction of the market.
The imbalance can be identified as price gaps where the price of the currency pair jumps from one level to another without any trading action taking place in between. This imbalance can be difficult to locate and draw on the chart, but the fractal break and balance indicator can help you easily see these imbalances. This indicator has other features such as market structure breakouts and order blocks, making it a powerful tool for smart money trading.
Indicator 2: Fluid Trades Indicator
The fluid trades indicator is designed to help traders focus less on marking up charts but to focus more on executing trades. The creator of this indicator combined the idea of price action and smart money concept to mark up the chart and accurately suggest the future direction of the price.
To move up or down in the market, a break in market structure must occur. A break in market structure occurs when the market starts to shift direction and then breaks the previous higher high or change of character in the case of when the price breaks the previous low of the market. The indicator uses the idea of pivot points to draw out points of interest that traders can watch out for trend reversal and price retracements. These demand levels can be used as order flows and in smart money trading, traders can stack up trades for higher returns.
Indicator 3: Order Blocks with Signals Indicator
The order blocks with signals indicator is designed to draw out huge institutional buy or sell orders placed over a particular period. During this period, institutional players aim to build up their positions in the markets in order to trade. To trade order blocks effectively, traders need to look for an area on the price chart where the price had a large move.
For an order block to be valid, there must be a break in market structure or a change of character, which is the break of the previous high or the previous low. The order block must also create an imbalance. Once an imbalance is created, the price must come back to mitigate the imbalance created. This is when traders should enter a trade and then target the next key level for take profit.
Conclusion
Using these three smart money indicators can help traders filter out fake signals and generate accurate trade entry signals. These indicators are free on trading view and do not require a premium trading view plan. By focusing on the imbalances, market structure breakouts, pivot points, and order blocks in the market, traders can make smarter trades and get higher returns. Remember to always use proper risk management and stay disciplined with your trading plan.