Smart Money Concept (SMC) Trading Strategy price action strategy based on the analysis of volume distribution.
Setup Strategy
Time Frame: 15 minutes
Markets: Forex, Crypto, and Stocks
Indicators:
Fluid Trades SMC Lite Indicator - to identify order blocks.
Range Filter Buy and Sell Indicator - to identify market trends and potential reversals.
Search in TradingView indicators: "Fluid Trades SMC Lite an Ut Bot alert" and add it to the chart.
Ut Bot alert, set (2, 1).
Fluid Trades SMC Lite default setting.
Strategy Rules:
Sell
Trade Entry:
Identify Supply Area:
When the price reaches a supply area (identified by the Fluid Trades SMC Light indicator), look for bearish candlestick patterns as a confirmation.
Examples of bearish patterns include bearish engulfing, shooting star, or evening star patterns.
Confirmation with sell arrow of Ut Bot alert:
Entry Trigger:
Once both conditions (bearish candlestick pattern and sell signal) are met, enter a sell position.
Stop Loss and Take Profit:
Stop Loss
Place the stop loss above the recent swing high. This protects from potential losses if the price reverses.
Take Profit
Set the take profit level at a risk-to-reward ratio of 1:2. This means for every unit of risk, you aim for two units of profit.
Alternatively, you can place the take profit at the next demand area identified by the Fluid Trades SMC Light indicator for potentially higher profits.
Example Trade:
Bearish Scenario:
Identify the last bullish candle before a sharp downward movement (bearish order block).
Wait for the price to retrace back to this order block zone.
Look for a bearish candlestick pattern within this zone.
Confirm with the Range Filter Buy and Sell indicator showing a sell signal.
Enter a sell position, place the stop loss above the recent swing high, and set the take profit at a 1:2 risk-to-reward ratio or at the next demand area.
Buy
bullish scenario: price reaches a demand area identified by the fluid trades smc light indicator. Look for bullish candlestick patterns (e.g., bullish engulfing, hammer).
Confirmation with buy arrow of ut Bot alert:
Entry Trigger:
Once both conditions (bullish candlestick pattern and buy signal) are met, enter a buy position.
Stop Loss and Take Profit:
Stop Loss
Place the stop loss above the recent swing low. This protects from potential losses if the price reverses.
Take Profit
Set the take profit level at a risk-to-reward ratio of 1:1.4-1.2 This means for every unit of risk, you aim for two units of profit.
Alternatively, you can place the take profit at the next demand area identified by the Fluid Trades SMC Light indicator for potentially higher profits.
Example trade
bullish scenario:
identify the last bearish candle before a sharp upward movement.
wait for the price to retrace to this order block zone.
look for a bullish candlestick pattern.
Confirm with the Ut Bot Alert buy signal.
enter a buy position, set the stop loss below the recent swing low, and place the take profit from 1;1.4 at 1:2 risk-to-reward ratio or at the next supply area.
By following this strategy, you leverage the concepts of smart money and order blocks, combined with additional confirmation from the Range Filter Buy and Sell indicator, to make informed trading decisions. This approach aims to provide high-probability trading opportunities with a structured risk management plan.
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