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Understanding the TGIF Trading Setup
The TGIF (Thank God It's Friday) trading strategy is a daily algorithmic pattern exclusively observed on Fridays. In trending market conditions, price frequently reverts to the weekly range after establishing the weekly high (Highest) or weekly low (Lowest). The ICT TGIF setup empowers traders to identify and capitalize on Friday's price reversals.
Formation of the TGIF Setup
The ICT TGIF Setup is predicated on recurring price patterns observed throughout the trading week. This strategy specifically targets price returning to the weekly range during the concluding hours of the week. Characteristically, following a week of heightened volatility, the market tends to retrace towards its weekly mean, thereby generating favorable trading opportunities.
TGIF Setup Within Weekly Ranges
The TGIF trading strategy aligns with price action within weekly ranges in the ICT style.
Steps to Implement the ICT TGIF Setup
To effectively utilize the TGIF Setup, follow these four sequential steps:
1. Identify the Weekly High or Low
On Fridays, the market typically forms a weekly high or low. These significant levels are generally established between the morning and afternoon New York Time sessions.
2. Await a Market Structure Shift (MSS)
Subsequent to the formation of the weekly high or low, traders should anticipate a Market Structure Shift (MSS) or a Change in State of Delivery (CISD). These events serve as crucial confirmations of a price reversal towards the weekly range.
3. Enter the Trade at Optimal Levels
Once the market structure shift is confirmed, traders can initiate trades at optimal entry points, such as Fair Value Gaps (FVGs) or Order Blocks (OBs).
4. Set Price Targets Using Fibonacci Levels
The Fibonacci retracement tool is employed to determine price correction targets. By setting Fibonacci from the weekly low to the weekly high (for a bullish week) or from the weekly high to the weekly low (for a bearish week), the 0.20 and 0.30 levels are designated as profit targets.
Fibonacci Settings for the TGIF Setup:
- Start: 1
- End: 0
- First Profit Target: 0.20
- Second Profit Target: 0.30
Trading a Bullish TGIF Setup
In a typical bullish TGIF setup, as observed on a EUR/USD 5-minute chart, price continues its decline until it reaches a key level within a higher timeframe. Following a Change in the State of Delivery (CISD) and the formation of an Order Block (OB) or Fair Value Gap (FVG), traders can initiate buy (long) trades, targeting the 0.2 and 0.3 Fibonacci levels.
Trading a Bearish TGIF Setup
Conversely, in a bearish TGIF setup, as illustrated in a USD/JPY chart, price initially ascends before reversing downward towards a significant level in a higher timeframe. After identifying a Market Structure Shift (MSS) and the formation of an Order Block (OB) or Fair Value Gap (FVG), traders can enter sell (short) trades, targeting the 0.2 and 0.3 Fibonacci levels.
Key Considerations for Utilizing the TGIF Setup
Adhering to these critical points can significantly enhance accuracy and minimize errors when employing the TGIF Setup:
- Pay Attention to Timing: The setup demonstrates its highest efficacy during the final hours of Friday, specifically between 1:30 PM – 2:00 PM New York Time. During this window, the market frequently returns to the weekly price range.
- Analyze Price Behavior: Observing repetitive price patterns assists in identifying a return to the weekly average. For instance, if price reaches a major support or resistance level during the week, it may retrace back to the weekly mean on Friday.
- Use Technical Confirmations: Integrating other ICT concepts helps confirm price reversals. For example, after a weekly high or low forms in the New York session on Friday, a Market Structure Shift (MSS) and the subsequent formation of an FVG in the opposite direction serve as robust confirmations for a return to the weekly range.
- Market Conditions: The TGIF setup performs optimally in markets characterized by high liquidity and significant weekly volatility, such as Forex and Stock Indices.
Conclusion
The TGIF Setup (Thank God It's Friday) within the ICT trading style is a potent strategy for identifying price reversals and initiating trades specifically on Fridays. By concentrating on weekly highs and lows, traders can effectively capitalize on potential retracements that typically occur at the conclusion of the trading week.
