Statuses

Unicorn Model Statuses

The Unicorn Model operates through a structured lifecycle that defines its current state and assesses whether a trade opportunity is valid or actionable.

The lifecycle consists of four phases:

• Formation

• Pre-Invalidation

• Invalidation

• Success

The current status of the model will become visible when you hover your cursor over the associated label (e.g., C1, R1, H1).

1. Formation

The Formation phase is the starting point of the Unicorn Model, where key structural elements are identified that indicate a potential market reversal, such as:

• Sweeps: Price moves that capture liquidity, often above or below significant swing points, signaling potential trend shifts.

• Zigzag (Breaker): A Zigzag Breaker in the Unicorn Model is a reversal pattern formed when price breaks the structure between the 2nd and 3rd Zigzag points, confirming a shift in order flow and initiating a new directional leg.

Once identified, the model calculates Standard Deviation, Liquidity Levels and display Macros, providing insight into potential price movements and the overall market bias.

2. Pre-Invalidation

In the Pre-Invalidation phase, the model is considered at risk of failing. This occurs when the price moves above the sweep high but the sweep itself remains intact (not fully broken). In this case:

• The model is viewed as unreliable but not yet fully invalidated.

• The sweep high remains significant, indicating the setup may still be valid, but it’s close to being invalidated.

Most Unicorn Models in this phase fail to follow through, as the market often reverses, making the original trade setup less reliable or invalid.

3. Invalidation

The Invalidation phase marks the point where the trade setup loses validity due to unmet conditions. A Unicorn Model is invalidated if:

• Price fails to reach the 2 standard deviation projection,

• Price does not tap the first liquidity level, or

• Price breaks above the sweep high (or low, depending on direction).

When invalidated, the setup should be discarded, as it no longer reflects the model’s expected market behavior.

4. Success

The Success phase confirms the Unicorn Model’s validity when price moves in line with expectations. It is achieved when:

• Price reaches the 2 standard deviation target, or

• Taps the first SSL/BSL liquidity level.

At this stage, the model is confirmed, giving traders greater confidence in executing the setup.

By mastering the Formation, Pre-Invalidation, Invalidation, and Success phases, traders can manage risk more effectively and capitalize on high-probability opportunities identified by the Unicorn Model.