Every ICT trader hears the same concepts repeatedly:
- Fair Value Gaps (FVG)
- Turtle Soup
- Market Structure
But how do you piece it all together into a clear, actionable strategy?
Today, I'll guide you through a simple and effective trading plan that anyone can learn.
The Foundation: Daily Bias 🛠️
Your trading plan starts with forming a daily bias. The process begins on the weekly chart and is broken down into two essential concepts:
1. IRL/ERL (Imbalance Range Low / External Range Low)
2. Candle Bias
1️⃣ IRL/ERL 🔄
- Price Target: Price is always moving towards an IRL (FVG) or a high/low (ERL).
- Market Maker Model: Each higher timeframe IRL/ERL move is accompanied by a lower timeframe market maker model.
2️⃣ Candle Bias 🕯️
- Reaction Analysis: The price's reaction to the previous candle provides your bias.
- Reversal Signals: If a previous candle's high/low is swept and the candle is engulfed, look for a reversal.
- Fib Perspective: This can also be seen as a range sweep and reversal, where fibs can be useful.
Market Maker Models 🎯
Every higher timeframe (HTF) move from IRL to ERL or vice versa features a lower timeframe (LTF) market maker model.
- Alignment: Ensure your trades are aligned with the market maker model’s target.
- Confirmation: Once the market maker model (MMXM) is confirmed, focus only on trades that follow the direction of the model’s target.
Step 2: Apply on the Daily Chart 📅
After setting up on the weekly chart, repeat the process on the daily chart.
- Alignment: Ideally, both weekly and daily charts should align for the highest probability trades.
- Clarity: If the weekly chart isn’t clear, drop down to the daily and continue until you find a clear direction.
Step 3: Move to H4/H1 for Immediate Framework ⏳
After marking IRL/ERL + Candle Bias on the Weekly & Daily charts, move down to the H4/H1 timeframes to confirm the move with market maker models.
- Intraday Framework: This will be your immediate framework for trades you take intraday.
Step 4: Time-Based Liquidity (TBL) ⏰
TBL refers to the high/low of a certain defined range in time.
- Higher Probability: These points are crucial when framing a reversal.
Step 5: Dissect Lower Timeframes for Entries 🔍
After establishing your bias and framework, dive into the lower timeframes (M15) and look for:
- M15 IRL/ERL
- Reaction to TBL + 7:30 am EST Opening Price
Pre-Trade Checklist ✅
Before entering a trade, ensure you follow this exact checklist. Now, let's dive into three LTF confirmations for your entry.
LTF Entry Confirmations 🎯
Entries will be on the M1 timeframe, with key levels on M15.
1. Market Structure Shift 🏗️
- M15 IRL/ERL: Align with your overall bias.
- M1 Shift: Look for a shift in structure with an FVG.
- Entry: Enter on the FVG, with stops above structure.
- Target: Aim for M15 opposing liquidity.
2. SMT Divergence 🔀
- Correlation Break: When correlating assets break correlation, a large move is likely.
- Combination: Combine this with a HTF key level for best results.
- Further Explanation: I’ll leave a full video at the end of the thread explaining SMT Divergence in detail.
3. iFVG 📉
- Order Flow: If one side of the order flow (FVG) is getting disrespected at a HTF key level, a reversal is likely beginning.
Study Example 📚
Let’s review an example based on the M15 strategy discussed earlier:
- TBL Swept: Beyond opening price.
- Aligned with HTF Bias: The market structure shift on LTF plus iFVG confirms the move.
By following this plan and refining your approach, you'll have a clear and structured strategy for trading with ICT principles. Study these concepts, apply them to your charts, and watch your trading skills improve! 🚀
#Learning #SMC #TechnicalAnalysis