The 18 concepts most of ICT's teaching rests on, in learning order, each with a plain definition and a link to its full guide, followed by a searchable glossary that labels which terms come from ICT and which come from SMC or the wider community.
Updated 29 September 2026 · 18 core concepts + A–Z glossary · ~24 min read
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ICT concepts are the terms Michael J. Huddleston, the Inner Circle Trader, uses to describe where liquidity sits, how price moves between liquidity and imbalances, and when in the day to look for trades. This page does two jobs. First, it defines the 18 concepts that most of his teaching rests on, in the order they build on each other. Second, it gives a searchable glossary of 79 terms, including the SMC and community terms you will meet online, each labelled by where it comes from.
Core ICT concepts, in learning order
Each concept below has a short definition and a link to its full guide. The first eight follow the same order as the seven foundations in our ICT for beginners guide, with displacement added before fair value gaps. For a step-by-step learning path with practice tasks, start with that guide. All times are New York time.
1. Market structure and the market structure shift (MSS)
Market structure is the sequence of swing highs and lows. Higher highs and higher lows describe bullish order flow; lower highs and lower lows describe bearish order flow. ICT's key structural event is the market structure shift: after price runs a prior high or low, it reverses with displacement and breaks the most recent short-term swing point in the other direction, often leaving a fair value gap behind. A break that has no liquidity run before it, or no displacement, carries less weight. SMC courses call similar breaks BOS and CHoCH, which is SMC vocabulary rather than ICT's.
In ICT's usage, liquidity means resting orders, mainly stop orders, that cluster where traders predictably place them. Buy-side liquidity (BSL) sits above old highs and relatively equal highs: the buy stops of short sellers and breakout buyers. Sell-side liquidity (SSL) sits below old lows and relatively equal lows. ICT teaches that price tends to move from one pool to another, and that a run on one side (a sweep or raid) often comes before a move toward the opposite side. Marking the obvious pools, such as the previous day's, week's and session's highs and lows, is usually the first job on a chart.
Daily bias is the direction you expect the day's range to expand toward. The draw on liquidity (DOL) is the specific level price is expected to reach, typically an old high or low or an unfilled fair value gap on the daily or 4-hour chart. ICT builds bias from the higher timeframe down: what has price just done, what is it reaching for, and is it trading in premium or discount of the current range? Bias is a working hypothesis for the session, not a prediction. If price takes the opposite pool with displacement, the read changes.
Kill zones are the session windows in which ICT looks for setups, because volume and volatility tend to rise around the major session opens. This site uses four, in New York time: Asian 7:00–10:00 PM, London Open 2:00–5:00 AM, New York Open 7:00–9:00 AM and London Close 10:00 AM–12:00 PM. Some sources extend the New York window to 10:00 AM. A kill zone tells you when to pay attention; it is not a trade signal. The quieter New York lunch hour, 11:30 AM–1:30 PM, is usually left alone.
Displacement is a fast, one-directional move made of large-bodied candles with small wicks: price leaving a level with obvious intent rather than drifting. ICT uses it as a quality check for other concepts. A market structure shift should break the swing point with displacement, and the fair value gaps that displacement leaves behind are the ones he treats as meaningful. There is no official size threshold; judge a move against the candles that came before it on the same timeframe.
A fair value gap is a three-candle pattern in which the middle candle moves so strongly that the wicks of candles 1 and 3 do not overlap. In a bullish FVG the gap runs from candle 1's high up to candle 3's low; in a bearish FVG it runs from candle 1's low down to candle 3's high. ICT also calls them BISI (bullish) and SIBI (bearish). Price often returns to trade into the gap, and the gap's midpoint, called consequent encroachment (CE), is a common reference for entries and for judging whether the gap is holding.
Bullish fair value gapGap = candle 1 high to candle 3 low · CE = its midpoint
Schematic, not a real chart. A bearish FVG is the mirror image: the gap runs from candle 1's low down to candle 3's high.
A bullish order block is the last down-close candle (or group of down-close candles) before an up-move that displaces and breaks structure. A bearish order block is the last up-close candle before a down-move that does the same. When price returns to the block, ICT watches for it to hold, and often uses its mean threshold, 50% of the order block's body (open to close), as the level that should not be closed through. Order blocks are most useful when they sit in the right half of the range (bullish blocks in discount, bearish blocks in premium) and have a fair value gap next to them.
Power of three describes how a candle, whether a day, a week or a session, tends to form: accumulation near the open, a manipulation move against the eventual direction, then distribution, the expansion toward the real objective. On a bullish daily candle this means price often trades below the opening price first, then rallies and closes near the high. The practical use is to expect the early move against your bias instead of chasing it. AMD (accumulation, manipulation, distribution) is the same idea as an acronym.
Take a dealing range, from a swing low to a swing high, and split it at 50%. That midpoint is equilibrium; above it is premium and below it is discount. ICT's rule of thumb is to look for buys in discount and sells in premium, so a bullish order block or fair value gap is more attractive when it sits below equilibrium of the range that matters. The idea only works once you choose the dealing range deliberately, usually on the timeframe that sets your bias.
A breaker block is an order block that fails after a liquidity run. Bullish example: price makes a swing high, drops to take out a prior low (sell-side liquidity), then rallies with displacement above that swing high. The up-close candle(s) at the swing high, a bearish order block that did not hold, become a bullish breaker, and when price trades back down into it, it is expected to act as support. The bearish breaker is the mirror image. The liquidity sweep before the break is what separates a breaker from a mitigation block (breaker vs mitigation compared).
A mitigation block uses the same failure-swing idea without the liquidity run. Bullish example: price fails to make a lower low and forms a higher low instead, then rallies above the prior swing high. The up-close candle(s) at that failed swing high become a bullish mitigation block that price may return to as support. ICT explains the name through traders who were trapped at that level and use the return to mitigate, or reduce, their losing positions. Because no liquidity was taken first, it is generally treated as a weaker reference than a breaker.
Optimal trade entry is ICT's Fibonacci retracement zone. After a displacing leg, draw the Fibonacci tool from the start of the leg to its end (swing low to swing high for a long). The OTE zone is the 62%–79% retracement, and ICT highlights 70.5% inside it. It is a location filter, not a signal on its own. The cleaner OTE entries line up with a fair value gap or order block inside the zone, in the direction of your bias, with the stop beyond the start of the leg.
The Judas swing is the false move early in a session that runs against the day's real direction, for example taking the Asian range high or low around the London open, or an early-morning high or low around the New York open, before price reverses. It is the manipulation leg of power of three at session scale. The practical lesson is patience: let the opening move take liquidity and show a market structure shift before you decide which way the session is going.
The Silver Bullet is a time-based setup ICT teaches in three one-hour windows, New York time: 3:00–4:00 AM, 10:00–11:00 AM and 2:00–3:00 PM. Inside the window you look for price to run a nearby liquidity pool, displace, and leave a fair value gap in the direction of your draw on liquidity. The entry is on a return into that gap, the stop goes beyond the swing that created it, and the target is the next pool of liquidity. It packages several core concepts into one rule set, which is why many students trade it first.
SMT stands for smart money technique. It compares two closely correlated markets, such as ES and NQ, or EUR/USD and GBP/USD. If one makes a new high while the other fails to, ICT reads the divergence as a sign that the move above the high was a liquidity run rather than genuine strength; the same logic applies at lows. For inversely correlated markets, such as EUR/USD and the dollar index, you compare opposite extremes. SMT is confirmation at a level you already expected to hold, not a stand-alone signal.
IPDA, the Interbank Price Delivery Algorithm, is ICT's name for the idea that price is delivered between pools of liquidity and imbalances in a repeatable way. Its most practical tool is the IPDA data range: look back 20, 40 and 60 trading days on the daily chart and mark the highs and lows inside each window as likely reference points and draws. ICT also projects the same 20/40/60-day windows forward to anticipate where price may be drawn next. He also describes quarterly shifts, when the ranges that matter tend to change every three to four months. Treat IPDA as a teaching model, not a documented bank system.
The New Week Opening Gap (NWOG) is the range between Friday's 5:00 PM ET close and the Sunday 6:00 PM ET open in futures. The New Day Opening Gap (NDOG) is the range between the 5:00 PM close and the 6:00 PM reopen on each weekday. ICT keeps the recent opening gaps and their midpoints (consequent encroachment) on the chart because price often trades back to them or reacts at them. They are reference levels and possible draws, not entries on their own.
ICT macros are short windows in which, he teaches, price often runs to liquidity or rebalances a fair value gap. The times usually taught, in New York time, are 2:33–3:00 AM, 4:03–4:30 AM, 8:50–9:10 AM, 9:50–10:10 AM, 10:50–11:10 AM, 11:50 AM–12:10 PM, 1:10–1:40 PM and 3:15–3:45 PM. They are a timing refinement for traders who already have a bias and levels, not a reason to trade. 8:30 AM (US economic releases) and 9:30 AM (the US equity cash open) are separate scheduled events, not macros.
The glossary covers 79 terms, grouped by category. Search or filter to find a term. Entries marked “Core list” are defined in full above. Labels such as “SMC term” or “Community framework” mark terms that did not come from ICT himself.
Where a candle's body closes, as opposed to where its wick reached. Many ICT confirmations, such as structure breaks and inversions, are judged on a body close beyond the level.
Price closing beyond a prior swing high in an uptrend (or swing low in a downtrend), signalling the trend is continuing. ICT describes this as a break in market structure; BOS as a named rule set is mainly SMC usage.
A reversal signal in which price closes beyond the opening price of the candle or series of candles that delivered the previous move. It usually appears earlier than a market structure shift.
SMC's name for the first break against the prevailing trend, read as an early warning of reversal. It is not an ICT term; ICT's closest equivalent is the market structure shift.
Sideways price within a defined range. ICT describes price as cycling through consolidation, expansion, retracement and reversal; liquidity builds on both sides of a consolidation.
The directional phase in which price leaves a consolidation with displacement and runs toward its draw on liquidity. In power of three it is the distribution leg.
ICT's template for a larger price leg: an original consolidation, a run away from it, a smart money reversal at a higher-timeframe level, then a return through the same levels toward the origin.
The turning point of a market maker model, where a higher-timeframe liquidity pool or PD array is reached and price shifts structure in the other direction.
Advanced
Swing Point Hierarchy (Short-, Intermediate-, Long-Term Highs and Lows)
A short-term high is a swing high with a lower high on each side. An intermediate-term high is a short-term high with lower short-term highs on each side, and a long-term high is an intermediate-term high with lower intermediate-term highs on each side. Lows work the same way in reverse.
The level price is expected to reach next, usually an old high or low or an unfilled gap on a higher timeframe. Covered with daily bias in the core list.
SMC term for a minor swing near a point of interest that attracts early entries, whose stops are taken before price reaches the real level. Not an ICT term.
External range liquidity is the highs and lows at the edges of a range; internal range liquidity is the fair value gaps and minor swings inside it. ICT teaches that price tends to alternate between the two.
A low-resistance run is a path to a liquidity pool with little in the way, such as untested highs with no opposing arrays; a high-resistance run has opposing arrays and tends to be slower and choppier.
Fading a false breakout: entering against the move after price runs an old high or low and fails to follow through. ICT borrowed the name from an older pattern popularised by Linda Bradford Raschke and Laurence Connors.
Consequent encroachment is the 50% midpoint of a fair value gap (or a wick). Mean threshold is 50% of the order block's body (open to close). Both are reference lines for entries and for judging whether a level is holding.
The first fair value gap to form after the 9:30 AM ET equity open, within the opening range period that ICT watches (roughly 9:30-10:00 AM). It is used as a reference level for the rest of the session.
A hidden imbalance where candles 1 and 3 overlap slightly but the middle candle shows displacement. It is commonly measured between the midpoints of the overlapping wicks. Not to be confused with IFVG, which means inversion FVG.
A fair value gap that price closes through, after which it is watched as a level from the other side: a failed bullish FVG can act as resistance, a failed bearish FVG as support.
A large, one-sided price run with very little two-way trading, often spanning several candles. ICT expects price to revisit such ranges, much like an oversized fair value gap.
In index futures, the gap between the previous regular-session close and the 9:30 AM ET open. Its midpoint and whether it fills early are used to frame the New York morning.
ICT's list of premium and discount arrays: old highs and lows, fair value gaps, order blocks, breakers, mitigation blocks, rejection blocks, liquidity voids and more, used as buy candidates in discount and sell candidates in premium.
A general trading term, used heavily in SMC, for any level you have marked in advance to watch for a trade, such as an order block, a fair value gap or a liquidity pool.
Usually described as a candle that trades into an earlier order block and then propels price away from it, so the new candle becomes its own reference level. Definitions vary between sources.
At a swing high or low formed by long wicks, the range from the candle bodies to the wick extreme. ICT watches for price to return to the body level and fail to close through it.
ICT's names for the two kinds of fair value gap. BISI (buy-side imbalance, sell-side inefficiency) is a bullish FVG; SIBI (sell-side imbalance, buy-side inefficiency) is a bearish FVG.
A gap created by a sudden repricing, such as around a news release or a market open, where price jumped with little or no trading in between. ICT treats it as a range price often returns to.
ICT's name for his routine daily buy and sell setups, built around the session sequence of a range, a false move and the expansion toward the day's draw.
The intraday model ICT walked through in his free 2022 YouTube mentorship: bias from the higher timeframe, a liquidity run inside a kill zone, displacement and a market structure shift, then an entry at the resulting fair value gap.
An entry technique that takes the trade as price first trades into a fair value gap on a retracement, rather than waiting for a deeper order block. Variations on lower timeframes are common.
The high and low of the Asian session. Many ICT traders mark it from 8:00 PM to midnight New York time; its edges are common targets for the London Judas swing.
The 2:00-8:00 PM New York time range. When it is small, ICT projects its size in standard deviations above and below it as possible areas for the next day's high or low.
ICT's intraday templates for where the day's high and low tend to form, depending on whether the false move happens in London, early New York or later.
High-impact scheduled releases such as NFP, CPI and FOMC, marked red on economic calendars. They can override normal session behaviour, and many ICT traders stand aside around them.
ICT's name for choppy conditions in which price runs stops on both sides without a sustained trend, often around major news. His advice is to stay out.
ICT's Friday setup: once the week has reached its objective, Friday may retrace part of the weekly range; ICT frames the retracement at roughly 20-30% of the week's range.
The three phases of power of three written as an acronym: a range, a false move against the eventual direction, and the expansion toward the objective.
The swing low to swing high (or high to low) range you use to measure premium, discount and equilibrium. Which range you pick depends on the timeframe that sets your bias.
The same idea as the weekly profile applied to a month: where the month's manipulation and expansion tend to fall, and how the monthly open is used as a reference.
Typical times of year when a market has historically tended to rise or fall. ICT uses them as background context for longer-term bias, never as an entry signal.
Reading the market from the higher timeframes to the lower ones: the higher timeframe sets direction and objectives, the lower timeframe is used to time the entry.
A community framework, not taught by ICT, that treats each candle's high and low as a range and trades the next candle's sweep of one side and return inside it.
A community-named term for an order block that is only visible on a lower timeframe, inside what looks like a single candle higher up. We could not confirm it as a term from ICT's own titled material.
A time framework developed by Daye, not ICT, that splits each year, month, week, day and session into four quarters. Its 'true open' levels (the true day open is 00:00 ET) come from this framework.
A named variation of the inversion fair value gap that student archives trace to ICT's 2023 mentorship. Definitions differ between sources, so treat it as a refinement of the inversion FVG.
A price range that has already been traded through in both directions (rebalanced) and is then revisited, and which some traders keep as a reference level even though no visible gap remains.
A single candle with a volume imbalance above and below its body, so it is suspended between them. ICT presented it in a YouTube review dated 30 September 2025.
ICT concepts are the terms and models taught by Michael J. Huddleston, who trades and teaches as the Inner Circle Trader. They describe where resting orders (liquidity) are likely to sit, how price moves between those pools and imbalances such as fair value gaps, and when in the day to look for setups: kill zones, macros and the Silver Bullet windows. Most of the material comes from his YouTube mentorships and lectures.
Which ICT concepts should I learn first?
Start with market structure, then liquidity, daily bias, kill zones, fair value gaps, order blocks and power of three (AMD). Those are the seven foundations in our ICT for beginners guide, in the same order as the core list on this page. Learn one at a time and mark it on historical charts before adding the next. Breakers, OTE, SMT, IPDA and the named models make much more sense once those are familiar.
How many ICT concepts are there?
There is no official list. ICT has named dozens of patterns, ranges and time windows over many years of videos, and students and other educators have added more names on top. This page covers 18 core concepts and a glossary of 79 terms, and it marks the terms that come from Smart Money Concepts (SMC), Quarterly Theory or community frameworks rather than from ICT.
What is the difference between ICT and SMC?
Smart Money Concepts (SMC) is a simplified vocabulary that grew out of ICT's public material. It leans on break of structure (BOS), change of character (CHoCH), inducement and supply-and-demand style zones. ICT's own teaching uses the market structure shift, puts more weight on time (kill zones, macros) and on fair value gaps, and uses ideas such as IPDA and SMT divergence that SMC courses often leave out. See our ICT vs SMC comparison.
What is a PD array in ICT?
PD array (premium and discount array) is ICT's collective term for the price levels he uses as references: old highs and lows, fair value gaps, order blocks, breaker and mitigation blocks, rejection blocks, liquidity voids, balanced price ranges and opening gaps. Arrays below equilibrium of the dealing range are candidates for buying, and arrays above it are candidates for selling.
Do ICT concepts work on forex, futures and crypto?
The concepts are about liquidity, imbalances and timing, so they can be applied to any liquid market, and ICT teaches them mainly on forex pairs and US index futures such as ES and NQ. The timing tools (kill zones, macros, Silver Bullet windows) are built around New York and London session hours, so they fit forex and index futures most naturally. Crypto trades around the clock with no session opens, and traders who apply ICT there usually keep New York time as their reference. No concept guarantees results in any market.
What is the best free source for learning ICT concepts?
ICT's own YouTube channel, youtube.com/@InnerCircleTrader, is the primary source: it hosts his free mentorship series and lectures. Use a reference like this page as a map and for definitions, but check how a concept is actually used in his videos, and keep in mind that many terms circulating online were named by other people.
Are ICT concepts proven to work?
No concept on this page has a published, independently verified track record, and none of them works as a stand-alone signal. They are a framework for reading price. Test any concept on historical charts and in a demo account first, keep risk small, and judge it on your own recorded results.
The free ICT One Model Playbook — the study order, one model written as criteria, and two sheets you print. It argues against buying anything, including from me.
