Price Action Strategy With M’s and W’s

Hello Astronauts. Hope everyone is doing good in those Forex markets. As you all know, as of recent we’ve had some pretty interesting fundamental news events. News events that have shifted the markets in way’s that brought upon a lot of risk for retail traders worldwide. As a result, I’ve been laying low with Forex for this past week due to the JPY holiday. But I will say that there have been some very profitable swings with the major pairs, and that’s the volatility I like to see when trading my DeepSpaceFX longterm strategy. However, in this post I wanted to give you guys a snippet of my price action strategy I’ve been working on that involves the concept of trading M’s and W’s, as well as breakouts. This was shared in a recent post on my IG page:@deepspacefx
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But before I share my strategy, I wanted to inform you on some of the most important, insider information you will learn along your Forex journey if you haven’t yet already learned it. This will pre-direct you on how I integrated my DeepSpaceFX Price Action Strategy alongside this secret trading methodology that I am about to share with you.

 

Price Action Strategy M’s and W’s “BTTM” Trading Methodology by Steve Mauro 

 

 

BTTM

 

 

For those of you who don’t know what M and W formations are, in its simplicity, M’s and W’s is a trading methodology coined by a firefighter gone multi-millionaire trader named Steve Mauro. He introduced this trading method in his BTTM (Beat The Market Maker Series). I first learned about this method about five years ago when I was part of a secret Facebook group that primarily traded breakouts after the Asian session (during the London session). Interestingly, his course was valued at $5000 and I believe the full training was $25,000 in total which still behoves me till this day. But someway somehow, the facebook group I was part of got ahold of this information for free. So in essence, at the start of my trading career, I was already exposed to some of the most expensive, insider Forex information out there. I took it upon myself to absorb as much of this information as I could because I knew that at some point, it would help me tremendously in my Forex journey.  It would be one of m secret weapons in trading the Forex charts. And here I am 4 years later.

 

M’s and W’s Formations Explained

The core concept of the M and W trading methodology revolves around the chart manipulation done by big banks that ultimately control the impulse movements in the Forex Markets. The relationship that the big banks have with retail forex traders is closer than one might think. Given the fact that most retail orders that are fulfilled and executed worldwide, CAN be seen by the big banks. In addition, these secret big bank entities also have access to insider information so they know exactly where the market will go. But it is part of their scheme to place stop hunts in key areas to trigger the stop losses of unskilled retail traders to greatly capitalize from those losses. Upon hearing this, you may think that the Forex game is “rigged” and it is TOTALLY safe to say so. However, if the big banks have access to such insider information and can scan orders pre-breakout, retail traders like me and you ALSO have access to the dirty manipulation tactics done by the big banks. And it is up to us to learn these manipulation patterns that happen day in and day out, and take advantage. We have to trade WITH the big banks, not AGAINST them. Now it becomes a fair game!

 

 

 

As you can see in the photo I posted above, at the start of every trading day, the Asian session begins with a channel of up and down, consolidated price movement. There are a lot of retail traders worldwide who trade the Asian session, (I’m one of them), but the Asian session also forms a lot of ‘fakeouts’ which I will explain later in the post. As price travels in waves of up and down movement, market orders are being executed by retail traders and later fulfilled through pending market orders either on the top (buy) or bottom (sell) of this Asian session box. As well as their stop-losses being placed on the opposite side of whatever trade entry was executed. Essentially, what is happening is that retail traders are anticipating a breakout either to the upside or downside. This is usually the case once the Asian session has finished itself by settings its current day HIGH and LOW. Now while Asian session is warming up, the big banks are already preparing the stop-hunts to trigger the stop-losses early on outside of the Asian session. This is usually done with a ‘fakeout’ swing or ‘stop-hunt’ going in the opposite direction of the true breakout direction to trigger stops. Now please make note that this doesn’t happen EVERYDAY, 100% of the time on the SAME pair. It happens on all pairs across the trading board. But on the days that it does happen, it can be devastating for retail traders because it completely shifts their overall confidence in their daily trading experience. Let me show you an example below:

 

DeepSpaceFX Price Action Strategy
This is how the start of every trading day occurs. (CLICK PHOTO)

 

DeepSpaceFX Price Action Strategy
The TRUE breakout begins. (CLICK PHOTO)

 

How this was incorporated with the DeepSpaceFX Price Action Strategy

 

Now that you have an understanding of how the M’s and W’s playout in the market, I wanted to explain to you how this incorporates my DeepSpaceFX Price Action Strategy. The only difference is that I use my DSFX CMF indicator to not only confirm entry from second leg M and W formations. But I also use it to stay in the trade for as long as possible to max out my profit when a breakout occurs. Refer to my IG post here: www.instagram.com/p/BwxXEEvg24V/

I feel like this strategy can greatly improve your odds of winning if you follow it to the core and understand the difference between a true breakout and a fakeout. Another thing I wanted to mention is that even when M and W formations take place (a double top or double bottom), a fakeout can STILL occur, which would then create a ‘3rd’ leg M or W. Rather than just a 2nd leg entry. This is when it then becomes a “triple top” or “triple bottom” pattern at the high or low depending on where the price is at that present time. If an ADDITIONAL fakeout occurs, now it becomes a ‘4th’ leg M or W rather than just a 3rd leg entry which then makes it a “head and shoulders pattern”. Here’s a very helpful picture guide to help you understand the different patterns.

 

 

DeepSpaceFX Price Action Strategy

 

Now there’s one important thing that all of the patterns in the photo have in common. It’s the ‘neckline’ (that horizontal line you see in the patterns above). The neckline tells us when to enter and it helps us prevent fakeouts because we would then wait for the price to close ABOVE or BELOW the neckline depending on the pattern for confirmation. Unless price has closed ABOVE or BELOW the neckline, a fakeout MAY still occur.

 

DeepSpaceFX Price Action Strategy
WAIT FOR THE NECKLINE BREAK FOR ENTRY! (CLICK PHOTO)

Hopefully, at this point, you now understand the importance of trading M and W formations for true breakouts, and how to avoid fakeouts in the market. If anything, the information within this post alone should greatly improve your trading profitability and provide you with a noticeable edge in the market.

 

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-Brandon Peoples

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