ICT & SMC Glossary

The phase where institutional traders quietly build large positions without significantly moving price against themselves. Price tends to consolidate or range during this phase before a major expansion move.

The trading session running approximately 00:00–09:00 GMT. Known for low volatility and range-bound price action, it often sets the liquidity pools that London and New York sessions later target.

Executing a trade immediately at the current available market price, rather than waiting for a specific limit price to be reached.

A previously bullish order block that price has traded through to the downside. Once violated, it flips its polarity and now acts as a resistance zone on any retest.

The last bearish (down) candle before a significant bullish impulse move. Represents a zone where institutional sell orders were placed; price tends to return to this zone before continuing lower.

A price movement that breaks beyond the most recent confirmed swing high (in an uptrend) or swing low (in a downtrend), confirming that the current trend is continuing in its established direction.

An order block that has been violated by price action and subsequently flips its role from support to resistance (or vice versa). Breakers are considered high-quality trade locations.

A previously bearish order block that price has traded through to the upside. Once violated, it flips and becomes a support zone on any retest from above.

The last bullish (up) candle before a significant bearish impulse move. Represents a zone of institutional buy interest; price often returns here before continuing higher.

Clusters of stop-loss orders resting above swing highs, placed by traders who are short. Institutions engineer price moves above these levels to trigger those stops and fill their own large sell orders.

A structural shift where price breaks the most recent swing point in the opposite direction of the prevailing trend. A CHOCH signals a potential trend reversal and is the first indication that smart money has shifted its directional bias.

A period where price moves within a defined range, oscillating between a support and resistance level, before eventually making a directional breakout move.

The exact 50% midpoint level of a fair value gap or imbalance. Price frequently retraces to the CE before continuing in the direction of the original imbalance.

The directional intention for price movement during a trading day, established by analysing higher timeframe market structure, premium/discount zones, and institutional order flow.

Price levels that fall below the 50% equilibrium of a defined price range. In a bullish environment, buying from the discount zone offers better risk-to-reward as price seeks to return to premium levels.

A strong, impulsive price move away from a consolidation or balance area, driven by institutional order flow. Displacement typically leaves behind a fair value gap and confirms the direction of smart money.

The phase where institutions offload their accumulated positions near market highs (or lows in a bear market), typically causing price to top out before a significant reversal.

The 50% midpoint of a defined price range or swing. ICT uses equilibrium to separate premium (above 50%) from discount (below 50%) zones, guiding entry direction.

Two or more swing highs formed at approximately the same price level. Equal highs indicate a pool of buy-side liquidity resting just above them, which smart money may target in a liquidity sweep.

Two or more swing lows formed at approximately the same price level. Equal lows signal a pool of sell-side liquidity below them, which institutions may sweep before driving price higher.

The phase of sharp, directional price movement following accumulation or distribution. During expansion, price moves rapidly in one direction as institutions execute their pre-planned trades.

A three-candle formation where the body of the middle candle creates a gap (imbalance) between the wicks of the first and third candles. FVGs represent price inefficiencies that price often returns to fill, making them high-probability trade locations.

The first candle that appears at the start of a new session or key time window. The FPC is used as a reference point for identifying institutional order flow direction for that session.

A technical tool using key Fibonacci levels (23.6%, 38.2%, 50%, 61.8%, 78.6%) derived from the Fibonacci sequence to identify potential areas where price may reverse after a move.

A repeating price pattern that appears at multiple timeframe levels simultaneously. The same structure seen on a daily chart can be found on a 15-minute chart, confirming alignment of institutional order flow.

A price discontinuity on a chart where no trading occurred between two consecutive candles. Gaps are treated as imbalances and price frequently returns to fill them.

A swing high that exceeds the most recent previous swing high. A series of higher highs confirms bullish market structure and trend continuation.

A swing low that holds above the most recent previous swing low. Higher lows confirm that buyers remain in control and the uptrend is intact.

Any timeframe above the chart being actively traded. HTF analysis establishes the overall market bias and identifies key structural levels that lower timeframe setups must align with.

A comprehensive trading methodology developed by Michael J. Huddleston (The Inner Circle Trader). ICT concepts focus on institutional order flow, market structure, liquidity, and time-based price delivery rather than retail indicators.

A price area where one side of the market (buyers or sellers) dominated completely, leaving an inefficiency on the chart. Price tends to revisit these imbalances to achieve efficient price delivery.

The collective buying and selling activity of large financial institutions — banks, hedge funds, central banks — that creates the major price movements visible on charts.

A fair value gap that has been fully traded through by price. Once violated, the IFVG inverts its role and acts as a support (if previously bearish) or resistance (if previously bullish) on any subsequent retest.

A false, engineered price move in the opposite direction of the intended daily move. Institutions create the Judas Swing to trap retail traders before reversing and moving price in the true intended direction, typically during the first 30–60 minutes of a major session.

Specific high-probability time windows when institutional trading activity peaks. The main kill zones are: London Open (02:00–05:00 EST), New York Open (07:00–10:00 EST), and London Close (10:00–12:00 EST).

Areas on the chart where clusters of stop-loss orders are concentrated. Institutions need these liquidity pools to fill their large orders, so price is engineered to sweep through these areas before reversing.

A concentration of resting orders (primarily stops) above swing highs or below swing lows. These pools are magnets for price before significant reversals.

A price move that extends briefly beyond a key level (equal highs, equal lows, swing points) to collect the resting orders before sharply reversing. Also called a "stop hunt."

The trading session from approximately 07:00–16:00 GMT. The London session typically produces the day's highest volatility and most significant price moves, overlapping with both Asian and New York sessions.

A swing high that fails to reach the level of the previous swing high. Lower highs confirm that sellers are in control and the downtrend remains intact.

A swing low that falls below the most recent previous swing low. A series of lower lows confirms bearish market structure and trend continuation.

Any timeframe below the chart being used for analysis. LTF charts are used to time precise entries and exits once the higher timeframe bias is established.

The second phase of the ICT Power of 3 model. Price moves against the expected direction to trigger retail stop-losses and sweep liquidity before the true institutional move (expansion) begins.

The pattern of swing highs and lows on a price chart that defines the current trend. Bullish structure shows higher highs and higher lows; bearish structure shows lower highs and lower lows.

A candle or zone that originally caused a price imbalance but has not yet been fully revisited (mitigated) by subsequent price action. Price often returns to these zones before continuing its original direction.

The price gap that forms between Friday's closing price and Sunday's opening price in the forex market. Price frequently revisits and fills this gap during the trading week.

The gap created at the start of each new trading week between last week's close and the current week's open. NWOGs act as magnets, with price frequently trading back to fill them.

The trading session from approximately 12:00–21:00 GMT. The NY session's overlap with London (12:00–16:00 GMT) typically produces the day's second major volatility spike.

A specific candle or zone on a chart representing the last institutional order placement before a significant move. Order blocks act as key support and resistance zones and are one of the most important concepts in ICT.

The 62%–79% Fibonacci retracement zone of a confirmed price swing. ICT considers the OTE the highest-probability entry location when trading with the established trend direction.

The collective net buying and selling pressure that drives price in a particular direction. Positive order flow (more buyers than sellers) drives price up; negative order flow (more sellers) drives it down.

Premium and Discount Arrays — a ranked framework of price delivery tools including order blocks, breaker blocks, fair value gaps, mitigation blocks, and more, used to identify the highest-probability trade locations.

The smallest standardised price movement for a forex pair. Equal to 0.0001 for most major pairs (e.g., EUR/USD) and 0.01 for JPY pairs. Pip value varies based on lot size and the pair being traded.

An ICT model describing three phases of institutional price delivery: Accumulation (building positions), Manipulation (false move to trap retail), and Distribution (the true expansion move).

Price levels that sit above the 50% equilibrium of a defined range. In a bearish environment, selling from the premium zone offers better risk-to-reward as price seeks to return to discount levels.

An order block that has already been tested and held at least once, lending it additional confluence. Propulsion blocks that have rejected price multiple times are considered especially high-quality trade locations.

A market condition where price oscillates between a defined support (low) and resistance (high) level without making significant directional moves. Ranges accumulate liquidity on both sides before breakout.

A temporary counter-trend price movement within the context of the dominant trend. Retracements are used to find lower-risk entry points in the direction of the primary trend.

The ratio comparing potential profit to potential loss on a trade. A 1:2 RRR means risking 1 unit to gain 2 units. Professional traders typically seek a minimum 1:2 or 1:3 ratio.

A deliberate, institution-engineered price move that targets and sweeps through a known liquidity pool (equal highs, equal lows, swing points) before reversing in the intended direction.

A short-term trading style targeting small price movements, typically holding positions for seconds to minutes. Scalpers aim for a high number of small wins that accumulate over a session.

Clusters of stop-loss orders resting below swing lows, placed by traders who are long. Institutions sweep these levels to fill their own large buy orders before driving price higher.

A specific ICT time-based trade setup that occurs during three defined windows: 03:00–04:00 EST, 10:00–11:00 EST, and 14:00–15:00 EST. The setup involves a liquidity sweep followed by an FVG entry.

The difference between the expected execution price of a trade and the actual price at which it fills. Slippage occurs in fast-moving markets or when trading in low-liquidity conditions.

The term used to describe institutional traders — banks, hedge funds, central banks, and market makers — whose large capital and inside knowledge allow them to move markets intentionally.

A trading methodology focused on understanding and following institutional order flow. SMC uses concepts like order blocks, liquidity, market structure, and imbalances to identify high-probability trade setups.

The difference between the bid price (sell) and ask price (buy) of a trading instrument. The spread is the broker's primary transaction cost and widens during low-liquidity periods.

A deliberate price move engineered by smart money to trigger retail traders' stop-loss orders, generating liquidity for institutional order fills before price reverses in the true direction.

Key price levels where historical buying (support) or selling (resistance) pressure has caused price to react. These levels reflect areas of past institutional activity and often act as magnets for future price.

A candle whose high is greater than the highs of both the candle immediately before it and the candle immediately after it. Swing highs mark potential resistance and liquidity zones.

A candle whose low is below the lows of both the candle immediately before it and the candle immediately after it. Swing lows mark potential support and liquidity zones.

A trading style that aims to capture medium-term price moves, typically holding positions for days to weeks. Swing traders use daily and 4-hour charts to identify trends and key levels.

The ICT principle that price levels only become significant at specific times. A key level combined with a kill zone time window dramatically increases the probability of a successful trade setup.

The general directional movement of price over a period. An uptrend (bullish) shows higher highs and higher lows; a downtrend (bearish) shows lower highs and lower lows; a sideways trend shows price ranging between levels.

A reversal pattern where price briefly breaks beyond a key swing level (hunting turtle traders' stops) before sharply reversing. Named after the Turtle Traders who used breakout strategies that smart money exploits.

An ICT trade model combining a breaker block with a coinciding fair value gap. The alignment of both PD arrays at the same price level creates an especially high-conviction entry zone.

The degree of price fluctuation in a market over a given time period. High volatility means larger, faster price moves; low volatility means price is relatively stable. Kill zones typically coincide with volatility expansions.

A price area where aggressive one-sided buying or selling occurred with little opposing activity between two consecutive candles. Unlike an FVG, a volume imbalance is defined by candle bodies rather than wicks.

The thin line (also called a "shadow") extending above or below the body of a candlestick, representing the highest or lowest price reached during that candle's time period.

A technical analysis framework developed by Richard Wyckoff based on four market phases: Accumulation, Markup, Distribution, and Markdown. Many SMC and ICT concepts are rooted in Wyckoff's work on institutional behaviour.