A Glossary of ICT Terms and Abbreviations
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    Default A Glossary of ICT Terms and Abbreviations

    For about three years, Michael Huddleston taught a price-action trading methodology here on Babypips. He began several threads, and posted dozens of videos, using the screen-name InnerCircleTrader. He acquired the nickname ICT here on this forum, and now he uses that nickname often instead of his real name.

    The methodology taught by Michael (ICT) is a synthesis of his own work plus techniques and metrics learned from various mentors, including Larry Williams. Michael has given unique names to many of those techniques and metrics, and that's the reason why this Glossary was compiled.

    For newcomers to the ICT methodology, the terms and abbreviations used by Michael and his students can be confusing. The following pages of definitions are intended to aid those newcomers in following discussions of ICT analysis and trading methods here on the forum.

    In February 2013, Michael removed all of his videos from this forum and from his YouTube channel, and left the Babypips community. He has since set up his own website and Twitter account; he has started to rebuild his YouTube channel with new teaching videos and market analysis videos; and he has begun posting on another forum. Links to these various resources can be found on page 5 of this Glossary.

    Previously, this Glossary included three pages of Video Notes compiled by Peter Fearon (screen-name peterma on this forum). Peter's Notes served as an index to the 100+ ICT videos originally posted on this forum. Now that those original videos have been removed from Babypips, and the new ICT videos posted on YouTube and elsewhere do not conform to the originals, Peter's Notes no longer link to existing videos, and his Notes have been removed from this Glossary.




    Page 1

    ICT Terms and Abbreviations


    Certain words and phrases, below, are italicized to indicate that they are defined separately, elsewhere in the Glossary.

    In the following definitions, two abbreviations are used frequently: i.e., meaning "that is"; and e.g., meaning "for example".


    Alphabetical terms and abbreviations --- A through G

    accumulation --- smart money buying at, or near, a swing low, in order to (1) enter long positions, or (2) cover short positions (i.e., smart money "buying low")
    AD (or A/D) --- accumulation and/or distribution
    ADR --- (see average daily range)
    A-KZ --- (see Asian Kill Zone)
    anticipatory trade analysis phase --- top-down analysis, phase 2: seasonal tendencies, SMT divergences (yields, USDX, etc.), COT report, and key S/R levels
    Asian Kill Zone --- nominally 8am-12pm Tokyo time (this time period may be expanded at the discretion of the trader); this is one of 4 kill zones
    Asian range --- this term may refer to (1) the 9am-2pm Tokyo time period, (2) the H-L price range within that period, or (3) price action within that H-L range
    Asian session --- 9am-7pm Tokyo time (a low-volume trading session, typically characterized by price consolidation within a restricted range)
    ATR --- (see average true range)
    AU --- AUD/USD pair
    Aussie --- nickname of the AUD/USD pair
    average daily range (ADR) --- the average of the most recent daily H-L ranges; typically, the last 5 daily H-L ranges are averaged to yield the ADR for day 6
    average true range (ATR) --- daily ATR is similar to average daily range (ADR), except that ATR accounts for price gaps (e.g., Sunday gaps), but ADR does not

    banks (or "big banks") --- top-tier investment banks (market-makers) in the interbank network, engaged in high-volume currency trading --- see list on page 5
    bazooka (or ICT bazooka) --- Michael sometimes refers to a standard type 2 oscillator divergence as a "bazooka", to contrast it with the more powerful stinger
    BE --- (see break-even)
    bear flag --- a fairly tight, fairly short-duration consolidation pattern formed at the bottom of a sharp down-move, marking a pause in the down-move
    bias --- (see directional bias)
    big figure --- (see figure)
    Bill Wolfe --- originator of the 5-point wave concept called Wolfe Waves
    break-even --- the price at which closing a position (either manually, or by being stopped-out) results in zero profit and zero loss
    BST --- British Summer Time (BST=GMT+1), the time zone in the U.K. and Ireland between March and October --- see London time
    bull flag --- a fairly tight, fairly short-duration consolidation pattern formed at the top of a sharp up-move, marking a pause in the up-move
    Bunds --- German government debt instruments; e.g., 2-year Bund, 5-year Bund, 10-year Bund, 30-year Bund
    buy program --- a trending market profile in which the directional bias is up (bullish), and trades in the direction of the trend are long (buys)
    buy zone --- given either (1) a HTF bullish bias, or (2) a ranging market, a buy zone is the price range below the pivot (P), or below the TT fair-value zone

    cable --- one of the nicknames of the GBP/USD pair
    caddie --- one of the nicknames of the USD/CAD pair
    central bank --- the entity responsible for overseeing the monetary system of a nation, or group of nations --- see list on page 5
    CFTC --- (see Commodity Futures Trading Commission)
    Chris Lori --- athlete, fund manager, forex trader, and teacher/mentor --- often mentioned positively by Michael
    City of London (or The City, or The Square Mile) --- the financial district in London
    classic Asian session buy signal --- a signal to go long after (1) a late NY session price decline, and (2) an Asian session price bounce off a key support level
    classic Asian session sell signal --- a signal to go short after (1) a late NY session price rise, and (2) an Asian session price bounce off a key resistance level
    coil expansion pattern --- a consolidation pattern (the coil) which is followed by a break-out (the expansion) whose extent depends on the dimensions of the coil
    commercials --- large futures and options hedgers whose position sizes require reporting to the CFTC; their net (aggregate) position appears in the COT report
    Commitment of Traders (report) --- weekly CFTC report on positions held by 3 classes of traders in individual futures and options contracts (including currencies)
    Commodity Futures Trading Commission --- U.S. regulator of commodity futures and spot forex; the CFTC compiles and publishes the COT report
    Commodity Research Bureau Index (CRB Index)--- an index of 19 commodities (agriculturals, metals, oil & gas); it is used as one element of inter-market analysis
    confluence --- occurrence of two or more significant technical levels (e.g., a pivot level and an OTE) at the same (or nearly the same) price on a chart
    consolidation --- a time period (consolidation period) in which price moves in a narrow range (consolidation range), typically bounded by short-term S/R levels
    correlated pairs --- two currency pairs whose prices move roughly in tandem (example: EUR/USD and GBP/USD; another example: AUD/USD and NZD/USD)
    correlated pair SMT --- (see the list of Smart Money Tools on page 5)
    COT (or COT report) --- (see Commitment of Traders report)
    CRB Index --- (see Commodity Research Bureau Index)

    day trade (or intraday trade) --- a trade in which the entry and exit are expected to occur within the same trading day, and the profit target is 30-100 pips
    DD --- (see drawdown)
    demo --- a practice platform, practice account, or practice trade, etc.
    directional bias --- current direction of price movement (as determined on HTF's), deemed to be the tradable trend (see buy program, and sell program)
    distribution --- smart money selling at, or near, a swing high, in order to (1) enter short positions, or (2) liquidate long positions, (i.e., smart money "selling high")
    doji --- a candlestick having a very small real body (or no real body), with upper and/or lower wicks of any length; it often indicates a swing high or swing low
    dollar - proper name of the U.S., Canadian, Australian and New Zealand currencies, often abbreviated $, C$, A$ and NZ$, respectively
    double-tap --- given an OTE retracement from a SH (or SL), a double-tap involves taking 1st profit at the SH (or SL), and 2nd profit at a higher profit-target
    double zeros (00's) --- (see figure)
    drawdown --- a measure of account depletion due to accumulated losses
    dumb money --- (see street money)

    EDT --- Eastern Daylight Time (EDT=GMT-4), the time zone in the eastern U.S. and Canada between March and November --- see New York time
    EG --- EUR/GBP pair
    EJ --- EUR/JPY pair
    EMA --- (see exponential moving average)
    equity management --- (see risk management)
    EPA --- estimated price at arrival; in a classic Wolfe Wave set-up, the price-point at the intersection of the EPA line and a vertical line drawn from the ETA
    EPA line --- in a classic 5-point Wolfe Wave set-up, the EPA line is a line drawn through points 1 and 4, and projected to the right; the EPA lies on this line
    EST --- Eastern Standard Time (EST=GMT-5), the time zone in the eastern U.S. and Canada between November and March --- see New York time
    ET --- Eastern Time in the U.S. and Canada (New York time) --- ET is either EST or EDT, depending on time of year
    ETA --- estimated time of arrival; in a classic 5-point Wolfe Wave set-up, the time (on a chart) indicated by the intersection of line 1-3 and line 2-4
    ETA line --- in a classic 5-point Wolfe Wave set-up, the ETA line is a line drawn through points 1 and 3, and projected to the right; the ETA lies on this line
    EU --- EUR/USD pair
    euro --- proper name of the European Union single currency, symbol €; also, one of the nicknames of the EUR/USD pair
    exponential moving average --- a moving average of data from n-number of periods, weighted exponentially to give greater weight to more recent data

    fair value --- the median price in a previous H-L price range (e.g., a previous Daily price range, or a Trader's Trinity price range); see no-man's land
    fib --- shorthand for fibonacci tool, or fibonacci level; (note: in common usage, fibonacci is sometimes capitalized)
    fibonacci expansion --- the use of a fibonacci tool (in the opposite direction to a fib retracement measurement) in order to establish swing projection price targets
    fibonacci extension --- continuation of a fibonacci retracement scale, beyond the 100% retracement level, typically to 127.2%, 161.8%, 200%, etc.
    fibonacci retracement --- a scale for measuring retracements as percentages of a price range, typically 0%, 23.6%, 38.2%, 50%, 61.8%, 76.4% and 100%
    fibonacci tool --- a price-measuring tool which divides a price range into percentages (see fibonacci retracement, fibonacci extension, and fibonacci expansion)
    fiber --- one of the nicknames of the EUR/USD pair
    fig --- shorthand for figure
    figure --- price of the form x.xx00 (or xxx.00 in the case of yen pairs) --- also called fig, big figure, full figure, and double zeros (00's); compare to handle
    fractal --- (def.1) one of the many price patterns which repeat themselves in all markets, on all time frames from 1-minute (or lower) to 1-Month (or higher)
    fractal --- (def.2) a pattern of 5 consecutive candles, in which the center candle has the highest high of the 5 candles, or the lowest low of the 5 candles
    fractal high --- in a 5-candle fractal pattern, if the center candle has the highest high of the 5 candles, then that high is a fractal high
    fractal low --- in a 5-candle fractal pattern, if the center candle has the lowest low of the 5 candles, then that low is a fractal low
    franc --- proper (French language) name of the Swiss currency, symbol Fr, SFr or ₣ (German language name - frank; Italian language name - franco)
    full figure --- (see figure)
    fundamental analysis --- analysis of macro-economic factors (interest rates, inflation, GDP, unemployment, etc.) which influence long-term currency trends

    general market analysis phase --- top-down analysis, phase 1: analysis of interest rates, USDX, Treasuries, stock indices, CRB Index, and gold and oil
    Gilts --- British government debt instruments; e.g., 2-year Gilt, 5-year Gilt, 10-year Gilt, 30-year Gilt
    GJ --- GBP/JPY pair
    GLGT --- "Good Luck and Good Trading", the signature used by Michael (and others)
    GMT --- Greenwich Mean Time, the world's commercial reference time zone, to which all other time zones are related by "offsets" (e.g., GMT-1, GMT+1, etc.)
    GMT pivots --- see London pivots
    GU --- GBP/USD pair
    gunning stops --- (see stop hunt)


    -- continued on page 2 --
    Last edited by Clint; 02-18-2014 at 08:37 AM.
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    Page 2

    ICT Terms and Abbreviations

    (continued)


    Alphabetical terms and abbreviations --- H through O

    H&S (or HS, or H-S, or H/S) --- (see head-and-shoulders top)
    H1, H4, D1, etc. --- chart time-frames (1-hour chart, 4-hour chart, Daily chart, etc.); expanded list: m1, m5, m15, m30, H1, H2, H3, H4, H6, H8, D1, W1, M1
    hammer --- a candlestick (of either color) having a short real body, a very short upper wick, and a long lower wick; it typically occurs following a down-move
    handle --- given a price of the form x.xxyy (or xxx.yy in the case of yen pairs), the part of the price denoted by x's is referred to as the "handle"
    hanging man --- a candlestick identical to a hammer, except that it typically occurs following an up-move
    head-and-shoulders top --- an ITH (the "head") preceded by, and followed by, a lower ITH; or a LTH (the "head") preceded by, and followed by, a lower LTH
    HH --- higher high
    hidden divergence --- trend-following divergence (see type 2 divergence)
    hidden OTE --- an OTE found by pulling a fib (1) from a price point other than a SH or SL (e.g., a KSR, a fig, or mid-fig), or (2) from SH to SH, or from SL to SL
    high probability price patterns --- certain candlestick patterns and chart patterns which reliably signal price direction --- see list on page 5
    higher time frame --- for most day traders and short-term traders, HTF means a time frame higher than 1-hour (e.g., 4-hour, Daily, Weekly, or Monthly)
    HL --- higher low
    H-L --- high-low (or high minus low) referring to a price range (e.g., Daily H-L range, Weekly H-L range, etc.)
    holy grail (or ICT grail, or ICT holy grail) --- an OTE (either buy or sell) confirmed by a type 2 (hidden, trend-following) oscillator divergence
    HTF --- (see higher time frame)

    ICT --- (see InnerCircleTrader)
    indi --- (see indicator)
    indicator --- a derivative of recent price data, computed in real time by algorithm, which purports to reveal certain trends or tendencies regarding future prices
    InnerCircleTrader --- may refer to Michael Huddleston, his methodology, his tools, his forum threads, or his videos
    inside day --- a daily candle with a lower high, and a higher low, than the previous daily candle; usually it signals a trend continuation
    institutional level (or institutional price level) --- price of the form x.xx20 (the 20 level), or x.xx80 (the 80 level)
    interbank network --- a group of top-tier banks, electronically linked through EBS or Reuters for currency trading among themselves and with major clients
    inter-market analysis --- analysis of correlations between interest rates, equities, commodities and currencies during conditions of inflation or deflation
    intermediate-term high --- a fractal high preceded by, and followed by, a lower fractal high
    intermediate-term low --- a fractal low preceded by, and followed by, a higher fractal low
    inverted head and shoulders bottom --- an ITL (the "head") preceded by, and followed by, a higher ITL; or a LTL preceded by, and followed by, a higher LTL
    ITH --- (see intermediate-term high)
    ITL --- (see intermediate-term low)

    JST --- Japanese Standard Time (JST=GMT+9), the time zone, year-round, throughout Japan --- see Tokyo time
    Judas swing --- a false price move (by smart money) to run stops and lure street money to the wrong side of the market, ahead of the real (opposite) move

    Ken Roberts --- trading and lifesyle guru, author, and lecturer; Michael credits Ken Roberts with the 62%-79% retracement concept (which Michael calls OTE)
    key S/R --- (see key support and resistance levels)
    key support and resistance levels --- S/R levels identified on HTF charts (H4, D1, W1), and then transferred to the LTF charts being analyzed or traded
    kill zone --- one of 4 high-probability time periods (typically 2 hours each) in which to find trade set-ups using ICT tools; see A-KZ, LO-KZ, NYO-KZ, and LC-KZ
    kiwi --- nickname of the NZD/USD pair
    KSR --- (see key support and resistance levels)
    KZ --- (see kill zone)

    large range day --- a day whose H-L price range (the day's high minus the day's low) substantially exceeds the day's ADR
    large specs --- large futures and options speculators whose position sizes require reporting to the CFTC; their net (aggregate) position appears in the COT report
    Larry Williams --- well-known millionaire commodity trader, author, and lecturer; Michael refers to Larry Williams as one of his mentors
    LC --- (see London Close)
    LC-KZ --- (see London Close Kill Zone)
    LH --- lower high
    LL --- lower low
    L/NY overlap --- London/New York overlap (both markets open) 1pm-5pm London time, 8am-noon, New York time; see London session and New York session
    LO --- (see London Open)
    LO-KZ --- (see London Open Kill Zone)
    London Close --- 5pm London time, the end of the normal business day in London
    London Close Kill Zone --- nominally 4pm-6pm London time (this time period may be expanded at the discretion of the trader); this is one of 4 kill zones
    London Open --- 8am London time, the beginning of the normal business day in London
    London Open Kill Zone --- nominally 7am-9am London time (this time period may be expanded at the discretion of the trader); this is one of 4 kill zones
    London pivots --- daily pivot levels based on midnight London time as the start of each forex trading day
    London session --- 8am-5pm London time; the final 4 hours of this session (the L/NY overlap) typically constitute the highest-volume period of the trading day
    London time --- GMT (October-March), or BST=GMT+1 (March-October) --- Note: Michael always refers to London time as GMT, regardless of time of year
    long-term high --- an intermediate-term high preceded by, and followed by, a lower intermediate-term high
    long-term low --- an intermediate-term low preceded by, and followed by, a higher intermediate-term low
    loonie --- one of the nicknames of the USD/CAD pair
    lower time frame --- for most day traders and short-term traders, LTF means a time frame lower than 1-hour (e.g., 30-minute, 15-minute, or 5-minute)
    LTF --- (see lower time frame)
    LTH --- (see long-term high)
    LTL --- (see long-term low)

    MA (or SMA) --- (see moving average)
    MACD --- (see moving average convergence/divergence indicator)
    major market analysis (MMA) --- (see inter-market analysis)
    market flow --- market direction (trend) indicated by the most recent break of a fractal high or low on a HTF chart (H1, H4, D1, W1); compare to market structure
    market-maker --- a top-tier bank, a member of the interbank network (where the currency market is literally "made"); see banks, and smart money
    market-maker profile ---
    market profile --- one of 4 current market environments: consolidation range profile, breakout (real or false) profile, trending profile, and reversal profile
    market structure ---an analysis method based on patterns of STH's, STL's, ITH's, ITL's, LTH's and LTL's on higher time frame (HTF) charts (H4, D1, and W1)
    MF --- (see market flow)
    Michael --- Michael Huddleston (screen-names: InnerCircleTrader and ICT), American stock/commodity/currency trader, and former contributor on the Babypips site
    mid fig --- (see mid figure)
    mid figure --- price of the form x.xx50 (the 50 level)
    Millionaire Traders' Guild --- Michael's thread (closed) on the "Show Me the Money - Daytrading" forum, emphasizing a plan-based approach to using the ICT tools
    MM --- def.1 (see market-maker)
    MM --- def.2 (see money management)
    MMA --- major market analysis (see inter-market analysis)
    MMP --- (see market-maker profile)
    momentum indicator --- a technical indicator (e.g., MACD) which measures the strength of a prevailing trend; it can be used instead of a price oscillator
    money management --- the proper use (in planning a trade) of position size, stop-loss, and R/R (reward/risk) ratio in order to limit losses and preserve capital
    moving average (or simple moving average) --- the average of the data from the most recent n-number of periods, not weighted (compare to EMA)
    moving average convergence/divergence indicator (MACD) --- a momentum indicator which uses 3 EMA's to compute a histogram depicting price momentum
    MR1, MR2, etc. --- intermediate resistance levels (computed from pivot-point formulas) --- see ICT Pivot-Point Formulas on page 5
    MS --- (see market structure)
    MS1, MS2, etc. --- intermediate support levels (computed from pivot-point formulas) --- see ICT Pivot-Point Formulas on page 5
    MT4 --- a retail trading platform, licensed worldwide to brokers, popular for its MQL4 scripting language allowing creation of EA's, custom indicators, and scripts
    MTG --- (see Millionaire Traders' Guild)

    negatively correlated pairs --- two currency pairs whose prices move (roughly) in opposite directions (example: EUR/USD and USD/CHF)
    nested OTE --- an OTE within an OTE --- a smaller (LTF) price swing with an OTE retracement, nested within a larger (HTF) price swing with its (larger) OTE
    New York Open --- 8am New York time, the beginning of the normal business day in New York
    New York Open Kill Zone --- nominally 7am-9am New York time (this time period may be expanded at the discretion of the trader); this is one of 4 kill zones
    New York pivots --- daily pivot levels based on midnight New York time as the start of each forex trading day
    New York session --- 8am-5pm New York time; the first 4 hours of this session (the L/NY overlap) typically constitute the highest-volume period of the trading day
    New York time --- EST=GMT-5 (Nov-March), or EDT=GMT-4 (March-Nov) --- Note: Michael always refers to New York time as EST, regardless of time of year
    news --- shorthand for scheduled economic data releases, whose release dates and times are known in advance, and whose metrics are forecast in advance
    NFP --- (see Non-Farm Payroll report)
    Nick Van Nice --- originator of the concept of hidden divergence (which Michael refers to as type 2 divergence)
    no man's land --- on a Trader's Trinity chart, no-man's land is the middle 25% of the (previous) H-L price range; the center of this zone is the fair-value price
    Non-Farm Payroll (report) --- U.S. employment report released on the first Friday of each month by the U.S. Department of Labor; NFP is often a market mover
    NYO --- (see New York Open)
    NYO-KZ --- (see New York Open Kill Zone)

    OB/OS --- overbought or oversold (this term usually refers to readings generated by a price oscillator)
    OHLC (or O-H-L-C) --- Open, High, Low and Close --- the 4 prices which are displayed graphically on each candle, or each price bar
    OI --- (see open interest)
    One-shot-one-kill --- ICT sniper tactic: Lie in wait (for a set-up), take aim (at the set-up), pull the trigger (enter the trade), nail the target (collect pips)
    open interest --- the number of open contracts (those not yet offset or delivered) in a specific commodity/delivery month; one of the metrics in a COT report
    optimal trade entry --- entry zone between the 62% and 79% retracement levels --- note that 62% and 79% are not standard fib retracement levels
    ORO pattern (or ICT ORO pattern) --- Overlapping Reflection and OTE --- a smaller reflection pattern within a larger OTE pattern
    OTE --- (see optimal trade entry)
    oscillator --- a technical indicator (e.g., RSI, stochastics, or W%-R) which plots price as a percentage (from 0% to 100%) of some variable
    outside day with a down close --- an engulfing Daily candle with a lower close; if confirmed by an oversold indicator, it signals a reversal to the upside
    overbought --- a price which appears to have moved too far counter to a bearish bias (as indicated by pivots, Trader's Trinity, or any of various oscillators)
    oversold --- a price which appears to have moved too far counter to a bullish bias (as indicated by pivots, Trader's Trinity, or any of various oscillators)


    -- continued on page 3 --
    Last edited by Clint; 10-04-2013 at 03:43 AM.
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    Page 3

    ICT Terms and Abbreviations

    (continued)


    Alphabetical terms and abbreviations --- P through T

    P (or PP, or CP) --- pivot, or pivot-point, or central piviot (computed from pivot-point formulas) --- see ICT Pivot-Point Formulas on page 5
    PA --- (see price action)
    PSLO --- (see protective stop-loss order)
    pac-man --- slang term referring to smart money "gobbling up" stops (like Pac-Man gobbling up pac-dots in the 1980's arcade game)
    PerfChart --- (see Performance Chart)
    Performance Chart --- chart tracking %-change in price (or yield, etc.) over a selected time period, starting from a 0% base-line --- see list of symbols on page 5
    pin --- shorthand for pin-bar
    pin-bar --- a candlestick, of either color, having a long upper or lower wick (or both), signaling market "hesitation" in the direction of the long wick
    point 1, point 2, point 3, point 4, and point 5 --- the 5 consecutive short-term price swing points which constitute a classic Wolfe Wave set-up
    position trade --- a trade in which the entry and exit are expected to occur weeks, months (or even years) apart, and the profit target is 1,000 pips or more
    pound --- informal name of the U.K. currency (proper name: pound sterling); also, one of the nicknames of the GBP/USD pair
    pound sterling --- proper name of the U.K. currency, symbol £
    Power of Three --- entry immediately after the close of a three-bar high (or low) at a key resistance (or support) level on a Daily chart (an advanced technique)
    price action --- a method of analyzing and/or trading any market, based only on price patterns and simple price measuring tools, but excluding indicators
    profit release phase --- in a typical accumulation/distribution scenario, this is the price range between the accumulation phase and the distribution phase
    protective stop-loss order (PSLO) --- formal term meaning the price at which a stop-loss is initially placed, or the price(s) to which the stop-loss is moved (trailed)
    Pro Traders' Club --- Michael's active thread on the "Newbie Island" forum, devoted to daily reviews and ICT tool application
    PTC --- (see Pro Traders' Club)
    pull a fib --- use a fibonacci tool to delineate a price swing (from initial price to final price) showing fibonacci retracement levels and fibonacci extension levels

    R1, R2, R3, etc. --- resistance levels (computed from pivot-point formulas) --- see ICT Pivot-Point Formulas on page 5
    range contraction --- the tendency for a series of large range days to be followed by one or more small range days
    range expansion --- the tendency for a series of small range days to be followed by one or more large range days
    reflection pattern --- a pattern in which price retraces beyond the OTE zone, the 100% fib retracement, and the 127% fib extension, creating a "reflected" OTE
    regular divergence --- trend-reversal divergence (see type 1 divergence)
    relative strength index (RSI) --- one of 3 price oscillators (RSI, stochastics, and W%-R) included in the ICT tool-set; use one of these (or use MACD)
    reversal profile --- an early-day price swing (up or down), taking out a key Daily or Weekly S/R level, followed by a reversal and a larger late-day price swing
    rip-tide reversal --- similar to a turtle soup reversal, but based on a false breakout of a SH or SL which formed more than 20 periods prior
    risk --- the size of the loss (in pips or in dollars) which will be sustained if a stop-loss is hit; note that risk is not the probability of sustaining such a loss
    risk management (or equity management) --- the combination of money management plus trade management
    risk off --- widespread trader attitude (or sentiment) in which high-risk positions are abandoned in favor of lower-risk-lower-return safe-haven positions
    risk on --- widespread trader attitude (or sentiment) in which low-risk safe-haven positions are abandoned in favor of higher-risk-higher-return positions
    RR (or R/R, or R:R) --- risk/reward ratio (e.g., SL/TP), or reward/risk ratio (e.g., TP/SL), depending on the order in which the numbers are stated
    RR tracks --- railroad tracks (refers to two, long, side-by-side candle bodies, with opposite colors, denoting an engineered price reversal)
    RSI --- (see relative strength index)
    running stops --- (see stop hunt)

    S1, S2, S3, etc. --- support levels (computed from pivot-point formulas) --- see ICT Pivot-Point Formulas on page 5
    S&D --- (see seek and destroy)
    scalp (or scalping trade) --- a trade in which the entry and exit are expected to occur seconds or minutes apart, and the profit target is 30 pips or less
    search and destroy --- (see seek and destroy) --- note that Michael uses both terms interchangeably
    seasonal tendencies --- tendencies of many markets (currencies, equities, commodities, bonds) to make LTH's or LTL's at specific times of year
    seek and destroy --- a smart money tactic (which savvy retail traders can stalk) of systematically gunning stops above and below a consolidation range
    sell program --- a trending market profile in which the directional bias is down (bearish), and trades in the direction of the trend are short (sells)
    sell zone --- given either (1) a HTF bearish bias, or (2) a ranging market, a sell zone is the price range above the pivot (P), or above the TT fair-value zone
    session --- daily period of high-volume forex trading in a particular market, generally 8am-5pm local time (see Asian session for an exception to this rule)
    SH --- (see swing high)
    shorter time frame --- a time frame shorter than the time frame being discussed; "shorter time frame" is not necessarily synonymous with lower time frame (LTF)
    short-term high --- a fractal high which has not evolved into an intermediate-term high (ITH) or a long-term high (LTH)
    short-term low --- a fractal low which has not evolved into an intermediate-term low (ITL) or a long-term low (LTL)
    short-term trade --- a trade in which the entry and exit are expected to occur within 2 to 5 trading days, and the profit target is 100-300 pips
    SL --- def.1 (see stop-loss)
    SL --- def.2 (see swing low)
    SM --- (see smart money)
    SMA --- simple moving average (see moving average)
    small range day --- a day whose H-L price range (the day's high minus the day's low) falls substantially short of the day's ADR
    smart money --- large banks and certain other institutions which have information on resting (stop and limit) orders -- information not available to street money
    Smart Money Tool --- an overlay of line charts of 2 (or 3) correlated instruments, on which short-term price divergences are readily seen --- see list on page 5
    SMT --- (see Smart Money Tool)
    SMT div --- (see SMT divergence)
    SMT divergence --- deviation from the normal positive or negative correlation between instruments on an SMT chart, signaling a potential price move
    sniper --- a trader "lying in wait" for a trade set-up to come into range
    S/R (or S-R, or S&R) --- (see support and resistance)
    sterling --- informal name of the U.K. currency (proper name: pound sterling); also, one of the nicknames of the GBP/USD pair
    STF --- (see shorter time frame)
    STH --- (see short-term high)
    STL --- (see short-term low)
    stinger --- in an upmove, a bullish type 1 divergence nested inside a bullish type 2 divergence; in a downmove, nested bearish type 1 and type 2 divergences
    stoch --- (see stochastics)
    stochastics --- one of 3 price oscillators (stochastics, RSI, and W%-R) included in the ICT tool-set; use one of these (or use MACD)
    stock index SMT --- (see the list of Smart Money Tools on page 5)
    stop hunt --- a price move engineered by smart money in order to trigger stop and limit orders resting above or below the current market price
    stop-loss --- the price level at which a resting order has been placed to close a position at a loss; or, the anticipated loss, in pips, when that price is hit
    stops --- a loose term referring to buy-stop or buy-limit orders resting above the current market, or sell-stop or sell-limit orders resting below the current market
    street money --- market participants other than smart money; street money is not privy to the inside information (resting orders) on which smart money trades
    Sunday gap --- price difference between Friday's close and Sunday's open, representing price movement over the weekend, while the retail market was closed
    support and resistance --- significant levels below and above the current market where price has reacted in the past, and might do so again in the future
    sweet spot --- the center of the target area for an OTE, at the 70.5% retracement level (which is midway between the 62% and 79% retracement levels)
    swing high --- any of the following: a three-bar high, a standard 5-bar fractal high, an intermediate-term high (ITH), or a long-term high (LTH)
    swing low --- any of the following: a three-bar low, a standard 5-bar fractal low, an intermediate-term low (ITL), or a long-term low (LTL)
    swing point --- a swing high or a swing low
    swing projection --- given a price swing (in the direction of a clear trend), swing projection uses fibonacci ratios to estimate the extent of the next price swing
    swing trade --- a trade in which the entry and exit are expected to occur a week or more (up to several weeks) apart, and the profit target is 300-1,000 pips
    Swissy --- nickname of the USD/CHF pair

    TA (or T/A) --- (see technical analysis)
    take-profit --- the price level at which a resting order has been placed to close a position with a profit; or, the anticipated profit, in pips, when that price is hit
    technical analysis --- market analysis based on price action, with or without technical indicators, but not utilizing fundamental analysis
    TF --- (see time frame)
    The City --- (see City of London)
    The Square Mile --- (see City of London)
    three-bar high --- a truncated fractal high, containing 3 bars (instead of 5), with the center bar having the highest high of the 3 bars
    three-bar low --- a truncated fractal low, containing 3 bars (instead of 5), with the center bar having the lowest low of the 3 bars
    three Indians climax reversal --- a series of 3 closely-spaced impulse price moves (higher or lower), followed by a price reversal
    time and price theory --- the use of (1) higher time frames (H4, D1, W1, and M1) to find key S/R, MS, and MF, and (2) confluences (on LTF's) to time trades
    time frame --- usually refers to a chart time frame, such as a 5-minute chart, a 4-hour chart, etc.
    time zone --- a designated geographical area whose time-of-day is determined in relation to GMT-time (or UTC-time); example: Moscow time = MSK = GMT+4
    Tokyo session --- 8am-5pm Tokyo time --- compare to Asian Session, which includes the Tokyo session plus the (GMT+8) Singapore and Hong Kong sessions
    Tokyo time --- JST=GMT+9 (year-round) --- note that Japan does not observe daylight saving time
    top-down analysis --- (1) general market analysis phase, (2) anticipatory trade analysis phase, (3) trade execution phase, and (4) trade reaction phase
    top-down approach --- (see top-down analysis)
    TP --- (see take-profit)
    TPDS --- (see Trading Plan Development Series)
    trade execution phase --- top-down analysis, phase 3: market tone, risk on or off, buy or sell program, HTF S/R levels, MS, MF, time and price, and trade entry
    trade management --- management of open trades to (1) reduce trade-risk to zero and protect profits on profitable trades; or (2) cut losses on losing trades
    trade reaction phase --- top-down analysis, phase 4: market failure to move, price rejection at S/R, news releases, global events, and/or trader issues
    Trader's Trinity --- chart dividing a Daily, Weekly or Monthly H-L range into zones: lower 25% (oversold), middle 25% (fair value), and upper 25% (overbought)
    trading plan --- written rules specifying the pairs, sessions, times of day, etc., to be traded; and the analysis methods, money management, etc., to be used
    Trading Plan Development Series --- a video series detailing the use of risk management, plus fundamental, inter-market, technical, and top-down analysis
    Treasuries --- U.S. government debt instruments; e.g., 2-year T-note, 5-year T-note, 10-year T-note, 30-year T-bond
    trend line --- an upward-sloping line below a series of progressively higher lows; or a downward-sloping line above a series of progressively lower highs
    triangle --- a consolidation pattern bounded by upper and lower lines which converge at a point somewhere to the right of the current candle
    TT --- (see Trader's Trinity)
    turtle soup --- a smart money trade placed counter (opposite) to a typical "turtle trade", anticipating a failure of the turtle trade (i.e., the turtles get "eaten")
    tweezers --- refers to two, long, side-by-side, upper (or lower) candle wicks, with opposite colors, typically at a swing high (or swing low)
    type 1 divergence --- price and oscillator diverge, signaling a probable trend reversal --- bullish: price-LL, oscillator-HL --- bearish: price-HH, oscillator-LH
    type 2 divergence --- price and oscillator diverge, signaling a probable trend continuation --- bullish: price-HL, oscillator-LL --- bearish: price-LH, oscillator-HH
    TZ --- (see time zone)


    -- continued on page 4 --
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    Page 4

    ICT Terms and Abbreviations

    (continued)


    Alphabetical terms and abbreviations --- U through Z

    UJ --- USD/JPY pair
    U.S. Dollar Index --- the USD measured against a weighted basket of 6 currencies: EUR 57.6%, JPY 13.6%, GBP 11.9%, CAD 9.1%, SEK 4.2%, and CHF 3.6%
    USDX --- (see U.S. Dollar Index)
    USDX SMT --- (see the list of Smart Money Tools on page 5)
    UTC --- Coordinated Universal Time; the world's scientific reference time zone; (for our purposes, the following are equivalent: UTC = UT1 = Zulu time = GMT)

    W%-R --- (see Williams%-R)
    Wall Street --- the financial district in Lower Manhattan (New York)
    What Every New & Or Aspiring Forex Trader...Still Wants To Know --- Michael's thread (now closed) on the "Newbie Island" forum; starting point for ICT instruction
    whiplash long and catapult short --- trading long, then short, when Sunday's open gaps lower; the whiplash fills the gap; the catapult extends the down-move
    whiplash short and catapult long --- trading short, then long, when Sunday's open gaps higher; the whiplash fills the gap; the catapult extends the up-move
    Williams%-R (or Williams%-Range) --- one of 3 price oscillators (W%-R, stochastics, and RSI;) included in the ICT tool-set; use one of these (or use MACD)
    Wolfe Waves --- a fractal (see def.1) price pattern, consisting of 5 swing points (point 1, point 2, ... etc.), used to predict a target price point 6 (the EPA)
    WW --- (see Wolfe Waves)
    WW1, WW2, etc. --- Wolfe Wave point 1, Wolfe Wave point 2, etc.

    yen --- proper name of the Japanese currency, symbol ¥; also, nickname of the USD/JPY pair
    yield triad SMT --- (see the list of Smart Money Tools on page 5)

    Z-configuration --- a fractal (see def.1) price consolidation pattern, seen on all time frames, of which the Z-day is the most often observed
    Z-day --- a day of price consolidation within a defined range, clearly bounded by S/R levels; Z-days often evolve into seek and destroy stop hunts


    Numerical terms

    00's (double zeros) --- x.xx00 (or xxx.00) price level (see figure)
    1R, 2R, 3R, etc. --- an alternative way of specifying a Reward/Risk (R/R) ratio (i.e., Reward = n x Risk); ex: if TP/SL = 3/1, then TP = 3 x SL; that is, TP = 3R
    1.28 projection --- this rule says that, if the 2 most recent SL's were n days apart, then the next SH will form (approx.) 1.28 x n days after the most recent SH
    5k-1mil --- Michael's 3-year, real-time, live trading demonstration, begun January 2013, to trade 5,000 USD to 1 million USD
    18 EMA --- 18-period EMA; together, the 18 EMA and the 40 EMA comprise a moving-average-crossover indicator, useful for day-trading and short-term trading
    20 level --- x.xx20 price level (see institutional level)
    40 EMA --- 40-period EMA; (see 18 EMA, above, for an explanation of its use)
    50 level --- x.xx50 price level (see mid figure)
    62 level --- shorthand for the 62% retracement level (not a standard fib retracement level)
    70 level --- shorthand for the 70.5% retracement level, which is the OTE sweet spot (not a standard fib retracement level)
    79 level --- shorthand for the 79% retracement level (not a standard fib retracement level)
    80 level --- x.xx80 price level (see institutional level)


    PerfChart symbols (a partial list) --- note that all prices and yields plotted in PerfCharts are end-of-day (EOD)

    $USD --- U.S. Dollar Index (Intercontinental Exchange pricing) --- see U.S. Dollar Index in the alphabetical listing
    $CRB --- Commodity Research Bureau (CRB) Index (compiled by Reuters/Jefferies) --- see Commodity Research Bureau Index in the alphabetical listing
    $GOLD --- spot gold (Chicago Mercantile Exchange pricing)

    $XBP --- one British pound priced in U.S. dollars (PHLX pricing, not spot forex pricing)
    $XEU --- one euro priced in U.S. dollars (PHLX pricing, not spot forex pricing)
    $XJY --- 100 yen priced in U.S. dollars (PHLX pricing, not spot forex pricing) --- note: this chart is the inverse of a standard USD/JPY forex chart
    $XAD --- one Australian dollar priced in U.S. dollars (PHLX pricing, not spot forex pricing)
    $NZD --- one New Zealand dollar priced in U.S. dollars (PHLX pricing, not spot forex pricing)

    $UST1M --- U.S. Treasury 1-month treasury bill (T-bill) yield
    $UST1Y --- U.S. Treasury 1-year treasury bill (T-bill) yield
    $UST2Y --- U.S. Treasury 2-year treasury note (T-note) yield
    $UST5Y --- U.S. Treasury 5-year treasury note T-note) yield
    $UST10Y --- U.S. Treasury 10-year treasury note (T-note) yield
    $UST30Y --- U.S. Treasury 30-year treasury bond (T-bond) yield

    (Note that Perf Charts are not currently available for U.K. Gilts or German Bunds)

    $INDU --- Dow Jones Industrial Average (DJIA)
    $SPX --- Standard and Poor's 500 Index (S&P500)
    $COMPQ --- Nasdaq Composite Index
    $NDX --- Nasdaq 100 Index

    (To set up Perf Charts, go to StockCharts.com - Free Charts, scroll down to "PerfCharts", and enter the desired symbol in "Create a PerfChart")


    -- continued on page 5 --
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    Page 5

    Selected Lists and Resources



    High probability price patterns --- listed in the order in which Michael presented them; for definitions, refer to the alphabetical listing (pages 1-4)

    doji
    hammer
    hanging man
    tweezers
    RR tracks
    head-and-shoulders top
    inverted head and shoulders bottom
    three Indians climax reversal
    triangle
    bull flag
    bear flag
    coil expansion pattern
    turtle soup reversal
    rip-tide reversal
    reflection pattern
    outside day with a down close
    inside day


    Smart Money Tools (SMT's)

    Yield triad SMT's --- in each of the following, the SMT consists of an overlay of line charts (of yields, not prices) of the positively correlated instruments listed:

    US Treasury yield triad SMT --- the U.S. 2-yr, 5-yr, and 10-yr T-notes; (the U.S. 30-yr T-bond may be included in this overlay, as well)
    US/UK/German 2-yr yield triad SMT --- the U.S. 2-yr T-Note, the U.K. 2-yr Gilt, and the German 2-yr Bund
    US/UK/German 5-yr yield triad SMT --- the U.S. 5-yr T-note, the U.K. 5-yr Gilt, and the German 5-yr Bund
    US/UK/German 10-yr yield triad SMT --- the U.S. 10-yr T-note, the U.K. 10 yr Gilt, and the German 10-yr Bund

    USDX SMT's --- in each of the following, the SMT consists of an overlay of line charts (of closing prices, unless noted otherwise) of the instruments listed:

    USDX/fiber SMT --- the U.S. Dollar Index and the EUR/USD pair; note that the USDX is negatively correlated with the fiber
    USDX/cable SMT --- the U.S. Dollar Index and the GBP/USD pair; note that the USDX is negatively correlated with the cable
    USDX/yield triad SMT --- the U.S. Dollar Index price, the U.S. 5-yr T-note yield, and the U.S. 10-yr T-note yield; note the positive correlations

    Correlated pair SMT's --- in each of the following, the SMT consists of an overlay of line charts (of closing prices) of the positively correlated pairs listed:

    fiber/cable SMT --- the EUR/USD and the GBP/USD
    aussie/kiwi SMT --- the AUD/USD and the NZD/USD

    Stock index SMT --- this SMT consists of an overlay of line charts (of closing prices) of three positively correlated stock indices

    US stock index triad SMT --- the DJIA, the S&P500 index, and the Nasdaq index


    ICT Session Times and Kill Zones --- expanded descriptions of the session times and kill zones defined in the alphabetical listing (pages 1-4)

    1. The London Session is defined as the normal business day in London, 8am-5pm London time. During northern hemisphere winter, London time is GMT; during summer, it is GMT+1. The London Open Kill Zone is a (minimum) 2-hour period which brackets the 8am opening of the session. The London Close Kill Zone is a (minimum) 2-hour period which brackets the 5pm close of the session.

    2. The New York Session is defined as 8am-5pm New York time, which is GMT-5 in the winter, and GMT-4 in the summer. The New York Open Kill Zone is a (minimum) 2-hour period which brackets the 8am opening of the New York Session.

    There is no New York close kill zone, because the New York close (5pm New York time) occurs at the lowest-volume time of the entire 24-hour trading day. Typically, worldwide forex trading volume is lowest between 5pm and 6pm New York time each trading day. By contrast, the London Close occurs at the end of the London/New York Overlap period (8am-noon New York time, and 1pm-5pm London time), which is the highest-volume 4-hour period of the trading day.

    3. The Asian Session --- as its name implies --- does not fit the pattern of the other two trading sessions. It comprises the trading sessions in Tokyo (and Seoul) in the GMT+9 time zone, plus the trading sessions in Singapore and Hong Kong (and several smaller markets) in the GMT+8 time zone. Tokyo is no longer the largest Asian forex market --- Singapore has recently captured that distinction. Together, Singapore and Hong Kong (which operate simultaneously) account for 76% more daily forex trading volume than Tokyo.

    The Asian Session is 10 hours long, unlike the London and New York sessions, which are each 9 hours long. The Session begins at 9am Tokyo time (8am in Singapore and Hong Kong), and ends at 7pm Tokyo time (6pm in Singapore and Hong Kong).

    The 5-hour Asian Range is defined as the first half of the 10-hour Asian Session. The Asian Range has special significance as a bellwether of the new trading day which has begun in Asia. (Newcomers to the ICT methodology often confuse the Asian Session and the Asian Range.)

    Finally, the Asian Kill Zone can be thought of as the Asian "open" kill zone. It begins one hour earlier than the start of the Asian Session, but it continues for a (minimum) 4 hours (rather than the minimum 2 hours of the other 3 kill zones). Basically, the Asian Kill Zone extends throughout the morning stock-trading sessions in Tokyo, Singapore and Hong Kong, prior to their lunch-time recesses.


    ICT pivot-point formulas --- these formulas are commonly referred to as "Classic" pivot-point formulas; they are built into many trading platforms.

    H, L, and C represent the High, Low, and Close of the previous time period (yesterday, for example, in the case of Daily pivots).
    P, R1, S1, etc. are price levels computed from H, L, and C, which are projected onto the current time period (today, in the case of Daily pivots).

    Here are 9 ICT pivot-levels and their formulas, listed in order (top down) from highest price to lowest price (as they would appear plotted on a chart):

    Second major resistance level --- R2 = P + H - L
    Second intermediate resistance level --- MR2 = (R1 + R2) / 2
    First major resistance level --- R1 = 2P - L
    First intermediate resistance level --- MR1 = (P + R1) / 2
    Pivot (also called pivot-point, or central pivot) --- P = (H + L + C) / 3
    First intermediate support level --- MS1 = (P + S1) / 2
    First major support level --- S1 = 2P - H
    Second intermediate support level --- MS2 = (S1 + S2) / 2
    Second major support level --- S2 = P - H + L

    (Note that Michael does not use, and does not refer to, these resistance levels: R4, MR4, R3, MR3; or these support levels: MS3, S3, MS4, or S4)


    Top-tier investment banks (10 largest in the interbank network) --- showing each bank's country of domicile and share of the worldwide currency market

    CitiGroup (USA) --- 16.04%
    Deutsche Bank (Germany) --- 15.67%
    Barclays Investment Bank (UK) --- 10.91%
    UBS AG (Switzerland) --- 10.88%
    HSBC (UK) --- 7.12%
    JPMorgan (USA) --- 5.55%
    Bank of America Merrill Lynch (USA) --- 4.38%
    Royal Bank of Scotland (UK) --- 3.25%
    BNP Paribas (France) --- 3.10%
    Goldman Sachs (USA) --- 2.53%

    (Note that these 10 banks transact almost 80% of the world's currency trading volume; source: EuroMoney, May 2014)


    Central banks (a partial list) --- note that Michael often uses the term central banks when referring to top-tier investment banks

    BdeM --- Bank of Mexico
    BOC --- Bank of Canada
    BOE --- Bank of England
    BOJ --- Bank of Japan
    ECB --- European Central Bank (central bank of the EU - presides over the central banks of the 18 countries which are members of both the EU and the EuroZone)
    FRS (or Fed) --- Federal Reserve System (the central bank of the U.S., consisting of 12 regional Federal Reserve Banks)
    HKMA --- Hong Kong Monetary Authority
    MAS --- Monetary Authority of Singapore
    NY Fed --- Federal Reserve Bank of New York (the largest and most powerful of the 12 regional Federal Reserve Banks in the U.S.)
    PBOC --- People's Bank of China
    RBA --- Reserve Bank of Australia
    RBNZ --- Reserve Bank of New Zealand
    SNB --- Swiss National Bank


    ICT interview on Babypips

    The Inner Musings of InnerCircleTrader --- Ananais' interview with Michael Huddleston, posts dated 11/22/11 - present


    ICT videos on YouTube

    InnerCircleTrader's channel - YouTube


    ICT Livestream (webinar) channel

    TheInnerCircleTradercom - live streaming video powered by Livestream --- currently inactive


    ICT Twitter account

    https://twitter.com/ICT_MHuddleston


    ICT MyFxBook account

    Inner Circle Trader System | Myfxbook --- currently private


    ICT website

    The Inner Circle Trader \ Home Page


    ICT forum participation

    FXGears - Trading Psychology --- Michael is a contributor on the FXGears forum


    ICT email address

    ICT@InnerCircleTrader.com


    ICT book recommendations --- books that Michael has recommended in his threads and/or in his videos

    Intermarket Technical Analysis (1991) --- John J. Murphy
    Technical Analysis of the Financial Markets (1999) --- John J. Murphy
    Intermarket Analysis (2004) --- John J. Murphy
    The Visual Investor: How to Spot Market Trends (2009) --- John J. Murphy

    Market Wizards (1988) --- Jack D. Schwager
    The New Market Wizards (1994) --- Jack D. Schwager
    Stock Market Wizards (2003) --- Jack D. Schwager
    Market Wizards - Updated (2012) --- Jack D. Schwager

    Trade Stocks and Commodities with the Insiders: Secrets of the COT Report (2005) --- Larry Williams
    The Commitments of Traders Bible (2008) --- Stephen Briese

    Trading for a Living: Psychology, Trading Tactics, Money Management (1993) --- Alexander Elder
    Street Smarts: High Probability Short-Term Trading Strategies (1996) --- Linda Bradford Raschke and Laurence A. Connors
    The Trading Game: Playing by the Numbers to Make Millions (1999) --- Ryan Jones
    Trade What You See: How To Profit from Pattern Recognition (2007) --- Larry Pesavento and Leslie Jouflas


    The Babypips Glossary --- definitions of 1,000 standard forex, finance and economic terms and abbreviations (most with detailed explanations)

    Terms - Forex Trading Information & Articles | Forexpedia



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    Last edited by Clint; 06-10-2014 at 01:25 PM.
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    Quote Originally Posted by Powerslave View Post
    thanks Clint, you have done a fantastic job!
    it would be awesome if you could add some general guidelines considering the order we should watch ICT videos etc.
    To be honest i've seen many posts from The Man Himself , with accumulated videos etc but i'm not sure if i follow the right order.

    Powerslave's quote, above, is from the original "Glossary" thread. That thread has been replaced by this one, so I think it makes sense to move the conversation from there to here. That (original) thread should be allowed to sink out of sight.




    Powerslave,

    My apologies for the long delay in replying to your post.

    Regarding your question about the order in which you should watch the ICT videos, I think there are really two separate questions here ---

    • First, what is the best order in which to watch the videos?

    • And second, what is the best order in which to incorporate the various ICT tools into your trading.

    In my opinion, the answer to the first question is simply to watch the videos in the order in which Michael has presented them. That order is not random. Michael has been using these tools for a long time, and he knows how to introduce them to you in a logical and sequential way. He's not only teaching you how to use each individual tool, but he's also teaching you how all the tools work together as a tool-set.

    The answer to the second question is not so clear-cut. When you watch the videos, some of the tools presented will appeal to you immediately; you will easily understand what they do and how they do it; and you will be eager to try them out. And that's exactly what you should do --- try them out. Start using them. Practice with them.

    I think it's pretty clear that the simplest and most intuitive tools --- the ones you are likely to be most comfortable with --- are the most fundamental and essential tools, as well. For most traders, time-and-price considerations, support and resistance, pivots, fibonacci levels, and OTE will be in this category.

    There will be other tools in Michael's toolbox which will confuse you, or even intimidate you. Which tools those are will depend on your personality, your education, your prior trading experience, your comfort-level with certain math or finance concepts, etc. You might feel bewildered by the COT report, or by Treasury-yield analysis, or by other highly-specialized ICT tools. Chances are that the tools which scare you most are the ones you can safely ignore for now.

    But, you won't know which tools appeal to you, and which tools don't, until you have had a look at all of them. And that's what the videos are for --- to introduce you to the tools. That's why I think you need to watch all the videos, in the order in which Michael has presented them; and then choose which tools to begin practicing with.

    I'm convinced that, if you begin gradually, and master a few of the simpler tools, then when you experience success with those tools, you will want to add more and more tools to your own personal toolbox. At that point, you will have the newly-acquired knowledge, experience and confidence to tackle those tools which intimidated you initially.

    Aside from the purely technical tools, like S/R, pivots, OTE, SMT, etc., there are three major subjects addressed in the ICT videos which you must study, grasp and incorporate into your thinking and into your trading ---

    (1) the nature of the forex market

    (2) the minefield of emotions inside your head, and how to control them, and

    (3) the related disciplines of money management and trade management

    Several videos are devoted specifically to one, or another, of these three subjects. But, every video in Michael's video archive touches on one or more of these basic subjects. These three subjects are pervasive. They will affect every trade you take, regardless of the technical tools you use. You need to glean every bit of information you can on these three subjects, from every single video in the archive.

    If you have gone through the Babypips School, you can probably relate your experience there to the advice that I'm giving you here. In each case --- in the Babypips School curriculum, and in the ICT "curriculum" --- you can't absorb all of it, all at once. Presumably, as you worked your way through the School, you practiced what you were learning on your demo-account charts. You should do the same thing with the tools you are about to learn in the ICT curriculum.

    Whenever you open your charts, direct your focus first to the higher time frames (4-hour, and up) --- in order to see the "forest", before you start looking at "trees".

    On your "working time frame" (say, the 1-hour chart), learn how to divide your charts into trading days, sessions, and kill zones. Figure out a simple and intuitive way that you can indicate these things on your charts, so that you can keep them always up to date, and easy to read.

    Look for the patterns and set-ups that Michael is teaching you. Train you eye to see directional bias, basic market structure, basic candlestick patterns, OTE's, price reversals, and stop-raids (and other manipulations).

    Keep in mind the things you have seen in the videos, but have put on the "back burner" for use at a later time. As you begin to see how those things fit into, and augment, your trading, be sure that you can go back and find them, when you want them. Taking notes as you watch the videos is the best way to create your own "index" of ICT subjects.

    Finally, I recommend that you focus on one pair. Period. Forget all the others. Apparently, many traders find it almost impossible to do this --- Oh, no! what if I miss a great opportunity on a particular pair, because I'm not watching it?

    Well, what if you impede your learning, because you're trying to watch too many things, all at once? It's all too common for newbie traders to chase after everything in sight --- like sailors on shore-leave, chasing every skirt that walks by.

    I trade the GBP/USD. Period. That's all. I watch the EUR/USD for confirmations and divergences, but I don't trade it. As for all the other pairs, I don't have a clue what the Yen, or the Aussie, or the Loonie, or any other pair is doing.

    I'm not pushing the GBP/USD at you. I'm just suggesting that you limit the distractions around you, by focusing on one pair, or two at most, and leave the others for another time.

    Sorry for the long-winded speech. I hope that somewhere in that wall of text you find something useful.

    Clint
    Last edited by Clint; 12-08-2012 at 01:25 PM.
    - Risk is the Price we pay for Opportunity -

  7. #7
    Clint's Avatar
    Clint is offline FX-Men Honorary Member
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    I have added the following to page 4 * of the Glossary:

    • ICT pivot-point formulas

    • a link to a YouTube index of ICT videos (March 2012 - present)

    • links to ICT Livestream (webinar) channels


    * Edit --- Ignore the page reference above ---
    the Glossary has been reorganized several times since that page reference was posted.
    Last edited by Clint; 09-04-2013 at 04:32 PM.
    Tassiefx and Sunny PIP like this.
    - Risk is the Price we pay for Opportunity -

  8. #8
    Vinster is offline Junior Member
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    I've been toying with the idea of doing this but I wouldn't have done it nearly as comprehensively. Very nice.
    syzygus likes this.
    Caution: I'm only about 70% right - which is enough to earn an advanced degree, but also enough to steer you wrong.

  9. #9
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    Siiiiiiiiiiiiiick!! thanks
    syzygus likes this.

  10. #10
    kubio's Avatar
    kubio is offline Senior Member
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    Absolutely amazing work, Clint!
    Thank you very much.
    syzygus likes this.

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