About this video

• Video Title: Trading Live with the #1 Scalper in the WORLD (EXTREME Accuracy)
• Channel: Chart Fanatics
• Speakers: Fabio Valentino, Ritz (Host)
• Duration: 03:34:10

Overview

This video features a live trading session and strategy breakdown with Fabio Valentino, a top-ranked scalper. He shares his methodology, focusing on order flow and volume analysis to identify high-probability trading opportunities, particularly during the New York session. The discussion covers identifying market states, refining entries, and managing trades with a strong emphasis on risk management and understanding market dynamics beyond basic price action.

Key takeaways

• Order Flow as a Superior Tool: The speaker emphasizes that order flow provides a more objective and precise way to read the market compared to traditional price action, enabling traders to understand market dynamics before price movements occur.
• Three-Step Trading Model: Fabio outlines a three-step model: 1. Understanding Market State (balance vs. imbalance), 2. Identifying Location (using volume profile and low volume nodes), and 3. Execution/Trigger (looking for aggression and specific order flow patterns).
• Importance of Market Context: The video stresses the need to understand the broader market context, including session times (New York session being preferred for this strategy), market conditions (compression vs. trending), and even global macro events, as they influence price action.
• Two Distinct Models: Fabio presents two primary models: a trend-following model for volatile New York sessions and a mean-reversion model suitable for consolidating markets or London sessions, highlighting the need to adapt strategies to different market environments.
• Risk Management is Paramount: Consistent profitability is linked to disciplined risk management, including setting strict stop-loss levels, managing position sizing, and understanding when to exit trades or move to break-even to protect capital, especially during volatile or uncertain market conditions.

Here's a detailed breakdown of the first chunk of the video (approximately 0:00 to 0:15):

The video begins by introducing a highly skilled scalper, described as the "best scalper in the world," who will be showcasing his strategy and breaking it down step-by-step. The host highlights that this is a rare opportunity to see such an advanced strategy explained for free.

Key points from the initial segment:

• Introduction of a Top Scalper: The video features an individual recognized for exceptional scalping abilities, aiming to demystify their approach.
• Focus on Strategy Breakdown: The core purpose is to dissect a successful trading strategy, making it understandable for viewers.
• Anticipation vs. Reaction: A common pitfall for many traders is highlighted: trying to predict market movements before they happen. This is contrasted with a more effective approach, though the specifics are not yet detailed.
• "Breakdown Candle by Candle": The scalper will demonstrate his thought process live, analyzing each candle to explain his real-time trading decisions. This live, detailed analysis is presented as a key differentiator.
• "Squeeze" Concept: The term "squeeze" is mentioned, suggesting a scenario where the market is primed for a significant move, often driven by aggressive buying or selling pressure. The scalper aims to capitalize on these moments.
• "Aggressive Sellers": The presence of aggressive sellers is identified as a signal that precedes specific market actions. The scalper uses this information to inform his trading decisions.
• "Top 1% Trader": The speaker is positioned as a highly elite trader, adding credibility to the strategy being presented.
• "Free Education": The value proposition is emphasized – providing high-level trading education without cost.
• Timeframe Flexibility: The strategy can be applied across various timeframes (15 minutes, 3 minutes, 1 hour, 5 minutes), with the speaker favoring the most aggressive approach.
• Real-World Application: The strategy discussed is stated to be the same one used in high-stakes trading competitions, such as the "World Trading Cup," implying its effectiveness under pressure.
• "Building Profit for the Day": The scalper's objective is to consistently build profits throughout the trading day.
• Introduction of the Speaker: The host introduces the guest as Fabio Valentino, a world-class scalper who has achieved significant returns (over 500% in 12 months in futures).

The initial part sets the stage, establishing the credibility of the speaker and the value of the upcoming strategy, focusing on a "read the market" approach rather than prediction.

Here's a detailed breakdown of the next chunk of the video (approximately 0:15 to 0:30):

This segment begins to delve into the core concepts of market structure and common trading misconceptions, laying the groundwork for Fabio's strategy.

Key points from this chunk:

• Misconceptions about Market Structure: Fabio states that many traders misunderstand market structure. He plans to explain what 90% of traders do incorrectly and why they lose money.
• Common Price Action Approaches: He describes typical patterns traders follow, such as identifying a "market structure shift," "change of character," or "breakout." These terms, while common, are presented as insufficient on their own.
• Trend Following and Retracements: Fabio illustrates a scenario where traders attempt to follow an established trend. They typically wait for a retracement after a breakout to enter the trade.
• "Short Sentiment" Example: He uses a "short sentiment" scenario, where traders might look to sell after a supply or order block is identified, expecting the price to continue downwards. This is framed within the context of following algorithmic mitigation levels.
• Critique of Basic Trend Following: Fabio asserts that this common trend-following approach, which relies on identifying patterns and aiming for specific risk-reward ratios (like 1:3 with a 50-60% win rate), is often unrealistic and ineffective without a deeper understanding of market mechanics.
• "Predicting the Market": He reiterates the earlier point that traders often fail because they try to predict the market's direction rather than reading its current state.
• Introducing the "Model" Concept: Fabio subtly begins to differentiate his approach by referring to it as a "model" rather than just a "strategy." This suggests a more dynamic and adaptive system that incorporates more than just a set of rigid rules.

In essence, this section critiques common, pattern-based trading approaches, particularly trend following, highlighting their limitations. It sets the stage for introducing a more robust method that goes beyond simple chart patterns to interpret the market's underlying mechanics.

Here's a detailed breakdown of the next chunk of the video (approximately 0:30 to 0:45):

This segment focuses on the importance of market context and how Fabio's model incorporates this understanding, specifically touching upon the concept of "balance" and "imbalance" in the market.

Key points from this chunk:

• Live Trading Example - The Squeeze: Fabio refers to a live trade, mentioning a "squeeze" scenario and observing aggressive sellers. He indicates he will "scale out" of the position because he anticipates the next move will be driven by aggressive sellers.
• "The Squeeze will be present here": He predicts the presence of a squeeze, demonstrating his ability to anticipate significant market events.
• "Look, there you have it. When I told you I will scale out, it's exactly because when you see this, the next step is aggressive sellers": This directly links his prediction to the observed market action, emphasizing the sequence of events he anticipates.
• "Out of Balance" vs. "In Balance": The concept of market states is introduced more formally. Fabio explains that markets are not always trending; they often operate in "balanced" areas where trading is efficient. When a market moves out of balance, it signals a potential shift or a new trend.
• "The squeeze will be present here": This is a predictive statement about an upcoming market event.
• "If you code the algorithm": While perhaps a metaphor, this phrase suggests a systematic, almost algorithmic approach to identifying these market conditions.
• "Top 1% Trader Showcasing Strategy for Free": The host reiterates the value proposition, emphasizing that this elite-level knowledge is being shared freely.
• Timeframe Reference: The mention of 15 minutes, 3 minutes, 1 hour, 5 minutes, and the "most aggressive one" (which he uses) highlights the adaptability of the strategy but also his preference for faster-paced trading.
• "World Trading Cup" Strategy: He connects the strategy directly to his success in a high-stakes competition, reinforcing its effectiveness.
• "Building Profit for the Day": This phrase is repeated, underscoring the focus on consistent daily gains rather than waiting for massive trends.

This chunk bridges the gap between theoretical concepts and practical application, showing a real-time example of anticipating and reacting to market dynamics ("squeeze," "aggressive sellers") based on his understanding of market states ("out of balance"). The core idea is that understanding when the market is out of balance is crucial for executing trades effectively.