Trading with Smart Money

Trading with Smart Money(SM) Tutorials

In this Trading with Smart Money tutorial series, we will cover all the features of Trading and Smart Money. As we progress in this tutorial series, you will learn from the basic to advanced-level features of trading and smart money. You can also access our Premium Videos for Free from our YouTube channel: https://www.youtube.com/c/LearnToTradeLTT.

Trading with Smart Money

Trading with “Smart Money” is a concept often discussed in financial markets. Smart Money refers to institutional investors, professional traders, and other well-informed market participants who are believed to have a deep understanding of the market and the ability to make informed trading decisions. These entities typically have access to significant resources, research, and information that individual retail traders often lack.

How Does the Market Work?

All financial markets operate according to the universal law of Supply and Demand.

• Law of Demand– The higher the price of an item, the less the demand (buyers don’t want to buy at a higher price), and the lower the price, the higher the demand (buyers want to buy at a low price).
• Law of Supply– The higher the price of an item, the higher the supply (sellers want to sell at a higher price), and the lower the price, the lower the supply (sellers don’t want to supply at a lower price.

So prices go up to find sellers and then go down to find buyers

Let’s think from a big player/smart money(SM) perspective. Smart Money (SM) removes the floating supply of stock by buying. This process is called accumulation. Now, they have the power to move the stock up or down.

Smart Money can mark the stock’s price when general market conditions appear favorable. At some point in the future, a time will come when the SM will capitalize on the higher prices achieved during the rally to generate profits by reselling the stock to uninformed traders and investors. This is now referred to as the distribution phase.

Why Does the Price Move?

What truly moves the price is AGGRESSION. If the price increases, buyers become more aggressive. If it goes down, then sellers are more aggressive.

If you are aggressive, you want to buy or sell NOW. If you want something now and want to be 100% sure you will get it, you must use a market order. This type of order ensures that your order will be filled regardless of the price. In other words, you place a MARKET ORDER to buy or sell immediately at the best available current price.

The aggressive market participants drive the price up or down with their market orders. This is the actual reason why the price moves. After accumulation or distribution, the smart money AGGRESSIVELY moves the price higher or lower.

Who are they?

1. They move the market, and they have the power.
2. They can influence values and direction.
3. They can bet against the trend or bet on the top or bottom.
4. They usually move the price at a very low volume.

How to Spot Smart Money (SM)?

Through analyzing

1. The Spread (i.e., the range of the price bar)
2. The Close (i.e., the point where the price closes on the current bar)
3. The Volume (i.e., activity),

How to Trade With Smart Money?

So, TRADING WITH Smart Money IS ABOUT TO GO WITH Smart Money. IF THEY BUY, WE WILL BUY. We will discuss all topics in greater detail in a step-by-step process.

About Me:

I am Pranaya Rout, a day trader trading stocks and futures since 2015. I am a student of the stock market, continually learning and updating my skills. I have decided to help aspiring traders by sharing what I have learned, reducing their learning curve. Please join my Telegram Channel, YouTube Channel, and Facebook Group to learn more and clear your doubts.

Disclaimer:

Trading involves the risk of financial loss. The information provided here is for educational purposes only.

Note: If we’ve missed any topics or if you’d like to learn about a specific topic, please let us know by commenting in the comment box. We will create a video and publish an article on it as soon as possible.

Course Information

Course Instructor

Dot Net Tutorials Author

Author: Pranaya Rout Pranaya Rout is a Senior Technical Architect with more than 11 Years of Experience, Microsoft MVP, Author, YouTuber, and Blogger eager to learn new technologies. Pranaya Rout has published more than 3,000 articles in his 11-year career. Pranaya Rout has very good experience with Microsoft Technologies, Including C#, VB, ASP.NET MVC, ASP.NET Web API, EF, EF Core, ADO.NET, LINQ, SQL Server, MYSQL, Oracle, ASP.NET Core, Cloud Computing, Microservices, Design Patterns and still learning new technologies.