The Four Models
Every setup on the ledger is one of four models: two for longs, two for shorts. All four share one rule, and one optional extra.
Model 1 has two deviations. Model 2 has one. I judge it on the higher timeframe: the lower timeframe can show extra deviations, sometimes three, but what counts is the structure on the higher timeframe, so I don't get hung up on exact counts. Accumulation is a long out of the range, distribution is a short out of the range.
Model 1 Accumulation
A long out of the range. Price deviates below the range twice, then breaks structure to the upside.
Model 1 has two deviations. I judge it on the higher timeframe. The lower timeframe might show three, but what counts is the higher-timeframe structure, so I don't get hung up on exact counts.
Model 2 Accumulation
A long out of the range. Price deviates below the range once, then breaks structure to the upside.
Model 2 has one deviation, judged on the higher timeframe. Extra wicks on the lower timeframe don't change that.
Model 1 Distribution
A short out of the range. Price deviates above the range twice, then breaks structure to the downside.
Model 1 has two deviations. I judge it on the higher timeframe. The lower timeframe might show three, but what counts is the higher-timeframe structure, so I don't get hung up on exact counts.
Model 2 Distribution
A short out of the range. Price deviates above the range once, then breaks structure to the downside.
Model 2 has one deviation, judged on the higher timeframe. Extra wicks on the lower timeframe don't change that.
Break of structure is the confirmation
A setup only counts when price breaks structure out of the range in the direction of the model. Before that, it's an idea, not a setup. Entry, stop and target are written down at that point, and the setup is logged.
Market Cipher B is added confidence only
Some setups also line up with Market Cipher B. When they do, the ledger marks it as added confidence. It is never the confirmation, and a setup without it is still a setup. The ledger tracks both groups separately so the difference can be measured over time.
Market Cipher BAffiliate link: I earn a commission if you subscribe, at no extra cost to you.
- Results are in R: one R is the distance from entry to stop. A setup that hits its stop is about -1R.
- Every setup is logged before the outcome is known, with the time in East Africa Time.
- Losses stay on the record, shown exactly like wins.
- "Taken" setups and "spotted" setups are labelled separately.
- A setup with no reported result shows as "Awaiting result". It is never guessed.