Simple ICT Turtle Soup Trading Strategy – Removing Bias and Emotion
In this post, I‘ll be breaking down the essential details of a straightforward mechanical trading system shared on YouTube for effectively identifying and capitalizing on market trends. Known as the "Turtle Soup" strategy, it provides traders with a simple set of rules to follow regarding market entries, stop losses, profit targets, and overall position management based on price action principles.
At its core, the trading approach aims to eliminate bias and emotional interference by instead trading like a robot – methodically following predefined entry and exit criteria. As such, it has the potential to not only simplify the trading process but also improve consistency for those able to exercise the requisite discipline.
Understanding the Turtle Soup Strategy
The backbone of the strategy relies on accurately diagnosing the current market structure based on the identification of prior "legs" and "ranges." The trader defines horizontal levels highlighting the extremes (highs and lows) reached during impulsive moves. These moves are called the ‘A‘ leg and ‘B‘ leg respectively. The market ranges develop in between as sideways consolidation or pullbacks take place.
The essence of the strategy dictates waiting for the market to break out of these ranges before looking to enter in the direction of the break on a retest. So for example, after an impulsive move higher forming the A leg high, a pullback ensues. Once price breaks above the A leg high, we want to see acceptance above that level with a close outside of the prior range. This provides an initial clue that the market may be ready to trend higher again.
At this point, we wait for a rotation back into the range to identify an optimal entry spot to capitalize on continuation back upwards with limited risk. It‘s important the pullback doesn‘t completely retrace and instead finds support above the B leg low. The entry trigger would then develop on a break back above the highs made during the pullback period. Stops are placed conservatively above the recent swing high to invalidate the setup if the market trades lower instead.
Defining Invalid Setups
While the basic premise seems straightforward, the trader explains certain nuances regarding valid and invalid setups with more granular detail. No trade triggers unless the candle body fully closes outside of the defined range. So wicks poking above or below are ignored until actual bodies print a full close higher or lower.
Additionally, the pullback into support must hold above at least the 0.5 Fibonacci retracement to confirm the uptrend or downtrend is indeed intact. If price unravels beyond the 0.5 level back down towards the 0.618 or 0.786 Fib levels, the setup gets invalidated, and the trader would wait for a new trading opportunity. Essentially, deeper retraces signal weakness in the prevailing trend calling the directional bias into question.
Measuring Breakout Validity
Furthermore, to avoid getting faked out by false breakouts, utilizing the Fibonacci tool also assists in gauging the validity of initial range breaks. By drawing the Fib retracement from the B leg low up to the A leg high, we can assess the conviction behind upside breakouts. If the 1.272 or 1.414 extensions get taken out swiftly beyond the high before pulling back, it‘s likely a stop run rather than a sustained directional move.
These temporary shakes above resistance aim to trigger breakout buys to fuel further liquidation when price reverses. So it‘s integral waits for multiple closes cementing the level as new support or overhead resistance before adding positions. If the market trades up to the 0.5 Fib – touching but not exceeding it – before rotating lower again, the breakout has credibility, increasing the odds follow through occurs upon retests.
Additional Resources and Recap
For interested traders looking to further improve their price action skills, the video creator also offers access to more advanced techniques through a private Discord community and trading course materials. The membership includes actionable setups, updates on current market conditions, and guidance from a network of profitable traders. Beginners can still benefit from the detailed free video tutorials provided on YouTube as well.
In summary, by sticking to predetermined entry rules, profit targets, stop losses, and maximum permissible losses per day, traders can develop an edge with this uncomplicated yet effectiveTurtle Soup strategy. Removing bias and subjective assessments from one‘s process improves consistency and emotional resilience over the long run. Defining ranges, identifying sustainable breaks and entering retracements offers a reliable approach to exploiting directional swings across virtually any liquid market.