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.

In February 2013, Michael removed all of his videos from this forum and from his youtube channel, and left the Babypips community. For 4 years thereafter, he used his own website, Twitter account, and a re-built youtube channel to teach an updated version of his methodology. Michael promised that his teaching would always be his gift to aspiring traders, and he would never charge a fee for it.

Sometime in 2016, Michael began teaching his methodology by subscription (fee) only. And in April 2017, he removed all of his new videos from his website and from his youtube channel, and closed his public Twitter account.

The Glossary which follows (below) refers to Michael’s original methodology – the one he taught here on Babypips. A lot of the material in this Glossary does not relate well to his more recent teaching. Nevertheless, the Glossary remains here on this forum as a reference for those who have access to the original ICT posts and videos.

The older videos have been archived as torrents by certain members of this forum who were early ICT followers. Search this forum for those torrents, if you are interested.

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

accumulationsmart 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 phasetop-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 I[/I] 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 I[/I], 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)
distributionsmart 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 phasetop-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 time of day at the Prime Meridian (defined as longitude 0°) in Greenwich England; also, the basis for a world system of 24 hourly time-zones, designated by GMT offsets (GMT-1, GMT+1, GMT+5½, etc.). See UTC.
GMT pivots — see London pivots
GU — GBP/USD pair
gunning stops — (see stop hunt)

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Page 2

[U]ICT Terms and Abbreviations[/U]

B[/B]

• [U]Alphabetical terms and abbreviations — H through O[/U]

[B]H&S (or HS, or H-S, or H/S)[/B] — (see [I]head-and-shoulders top[/I])
[B]H1, H4, D1, etc.[/B] — 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
[B]hammer[/B] — a candlestick (of either color) having a short real body, a very short upper wick, and a long lower wick; it typically occurs [U]following a down-move[/U]
[B]handle[/B] — 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”
[B]hanging man[/B] — a candlestick identical to a [I]hammer[/I], except that it typically occurs [U]following an up-move[/U]
[B]head-and-shoulders top[/B] — an [I]ITH[/I] (the “head”) preceded by, and followed by, a lower [I]ITH;[/I] or a [I]LTH[/I] (the “head”) preceded by, and followed by, a lower [I]LTH[/I]
[B]HH[/B] — higher high
[B]hidden divergence[/B] — trend-following divergence (see [I]type 2 divergence[/I])
[B]hidden OTE[/B] — an [I]OTE[/I] found by [I]pulling a fib[/I] (1) from a price point [U]other than[/U] a [I]SH[/I] or [I]SL[/I] (e.g., a [I]KSR,[/I] a [I]fig,[/I] or [I]mid-fig[/I]), or (2) from [I]SH[/I] to [I]SH,[/I] or from [I]SL[/I] to [I]SL[/I]
[B]high probability price patterns[/B] — certain candlestick patterns and chart patterns which reliably signal price direction — see list on page 5
[B]higher time frame[/B] — for most day traders and short-term traders, [I]HTF[/I] means a time frame higher than 1-hour (e.g., 4-hour, Daily, Weekly, or Monthly)
[B]HL[/B] — higher low
[B]H-L[/B] — high-low (or high minus low) referring to a price range (e.g., Daily H-L range, Weekly H-L range, etc.)
[B]holy grail (or ICT grail, or ICT holy grail)[/B] — an [I]OTE[/I] (either buy or sell) confirmed by a [I]type 2[/I] (hidden, trend-following) [I]oscillator divergence[/I]
[B]HTF[/B] — (see [I]higher time frame[/I])

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

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

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

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

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

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

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

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Page 3

[U]ICT Terms and Abbreviations[/U]

B[/B]

• [U]Alphabetical terms and abbreviations — P through S[/U]

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

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

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

– continued on page 4 –

Page 4

[U]ICT Terms and Abbreviations[/U]

B[/B]

• [U]Alphabetical terms and abbreviations — T through Z[/U]

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

[B]UJ[/B] — USD/JPY pair
[B]U.S. Dollar Index[/B] — 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%
[B]USDX[/B] — (see [I]U.S. Dollar Index[/I])
[B]USDX SMT[/B] — (see the list of [I]Smart Money Tools[/I] on page 5)
[B]UTC[/B] — Coordinated Universal Time - the modern name for the GMT time/time-zone system. For our purposes, UTC=GMT, and UTC offsets = GMT offsets.

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

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

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

• [U]Numerical terms[/U]

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

• [U]PerfChart symbols (a partial list)[/U] — note that all prices and yields plotted in PerfCharts are end-of-day (EOD)

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

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

[B]$UST1M[/B] — U.S. Treasury 1-month treasury bill (T-bill) yield
[B]$UST1Y[/B] — U.S. Treasury 1-year treasury bill (T-bill) yield
[B]$UST2Y[/B] — U.S. Treasury 2-year treasury note (T-note) yield
[B]$UST5Y[/B] — U.S. Treasury 5-year treasury note T-note) yield
[B]$UST10Y[/B] — U.S. Treasury 10-year treasury note (T-note) yield
[B]$UST30Y[/B] — 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)

[B]$INDU[/B] — Dow Jones Industrial Average (DJIA)
[B]$SPX[/B] — Standard and Poor’s 500 Index (S&P500)
[B]$COMPQ[/B] — Nasdaq Composite Index
[B]$NDX[/B] — 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 –

Page 5

[U]Selected Lists and Resources[/U]

• [U]High probability price patterns[/U] — listed in the order in which [I]Michael[/I] 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

• [U]Smart Money Tools (SMT’s)[/U]

[U]Yield triad SMT’s[/U] — in each of the following, the [I]SMT[/I] 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 [I]Gilt,[/I] and the German 2-yr [I]Bund[/I]
US/UK/German 5-yr yield triad SMT — the U.S. 5-yr T-note, the U.K. 5-yr [I]Gilt,[/I] and the German 5-yr [I]Bund[/I]
US/UK/German 10-yr yield triad SMT — the U.S. 10-yr T-note, the U.K. 10 yr [I]Gilt,[/I] and the German 10-yr [I]Bund[/I]

[U]USDX SMT’s[/U] — in each of the following, the [I]SMT[/I] consists of an overlay of line charts (of closing prices, unless noted otherwise) of the instruments listed:

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

[U]Correlated pair SMT’s[/U] — in each of the following, the [I]SMT[/I] 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

[U]Stock index SMT[/U] — this [I]SMT[/I] 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

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

[B]1. The London Session[/B] 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 [B]London Open Kill Zone[/B] is a (minimum) 2-hour period which brackets the 8am opening of the session. The [B]London Close Kill Zone[/B] is a (minimum) 2-hour period which brackets the 5pm close of the session.

[B]2. The New York Session[/B] is defined as 8am-5pm New York time, which is GMT-5 in the winter, and GMT-4 in the summer.
The [B]New York Open Kill Zone[/B] 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 (1pm-5pm London time, and 8am-noon New York time), which is the highest-volume 4-hour period of the trading day.

[B]3. The Asian Session[/B] — 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 [I]76% more[/I] 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 [B]Asian Range[/B] 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 [I]Asian Session[/I] and the [I]Asian Range.[/I])

Finally, the [B]Asian Kill Zone[/B] 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 [I]stock-trading sessions[/I] in Tokyo, Singapore and Hong Kong, prior to their lunch-time recesses.

• [U]ICT pivot-point formulas[/U] — 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 [U]previous[/U] 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 [U]current[/U] time period (today, in the case of Daily pivots).

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

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

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

• [U]Top-tier investment banks (10 largest in the [I]interbank network[/I])[/U] — showing each [I]bank’s[/I] country of domicile and share of the currency market

CitiGroup (USA) — 10.74%
JPMorgan (USA) — 10.34%
UBS AG (Switzerland) — 7.56%
Bank of America Merrill Lynch (USA) — 6.73%
Deutsche Bank (Germany) — 5.68%
HSBC (UK) — 4.99%
Barclays Investment Bank (UK) — 4.69%
Goldman Sachs (USA) — 4.43%
Standard Chartered (UK) — 4.26%
BNP Paribas (France) — 3.73%

(Note that these 10 banks transact more than 63% of the world’s currency trading volume; source: Euromoney, May 2017)

• [U]Central banks (a partial list)[/U]

BdeM — Bank of Mexico
BOC — Bank of Canada
BOE — Bank of England
BOJ — Bank of Japan
ECB — European Central Bank (presides over the central banks of the 18 countries which are members of [U]both[/U] 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

• [U]ICT book recommendations[/U] — books that [I]Michael[/I] has recommended in his threads and/or in his videos

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

[B]Market Wizards[/B] (1988) — Jack D. Schwager
[B]The New Market Wizards[/B] (1994) — Jack D. Schwager
[B]Stock Market Wizards[/B] (2003) — Jack D. Schwager
[B]Market Wizards - Updated[/B] (2012) — Jack D. Schwager

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

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

• [U]The Babypips Glossary[/U] — definitions of 1,000 standard forex, finance and economic terms and abbreviations (most with detailed explanations)

Terms - Forex Trading Information & Articles | Forexpedia

– € £ $ ¥ ₣ –

[I]Powerslave’s[/I] 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.

[B]Powerslave, [/B]

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 [I]in which to watch the videos?[/I]

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

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 [I]not[/I] 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

1 Like

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.

I’ve been toying with the idea of doing this but I wouldn’t have done it nearly as comprehensively. Very nice.

Siiiiiiiiiiiiiick!! thanks :slight_smile:

Absolutely amazing work, Clint!
Thank you very much.

Personally, i’m become more like u than ICT, Clint. Ahaha :slight_smile:

Coz u like FX police officer here. And u wrote ur thread here just like police rules, arranged that very structured.

I’ve been called a lot of things.

This is the first time I’ve ever been called “FX police officer”.

I’m not sure what to make of that compliment (?).

1 Like

This is excellent Clint - many thanks for your time and effort.

Clint - thank you for collecting all this information into one thread - your efforts are well appreciated!

[B]Vinster, DroneTrading, kubio, spidypips, mapman, and Randomusername —[/B]

Thanks for your kind words, and for your encouragement.

The Glossary isn’t finished — there are some loose ends to be tied up. But, it’s nearly up-to-date.

As Michael continues to teach, there likely will be new terms and abbreviations to be added. So, it remains a work-in-progress. I’ll keep at it.

I’m glad to know that it’s useful to you guys.

As I mentioned before, if you find mistakes, or things that I have overlooked, let me know.

Peter (screen-name [I]peterma[/I]), a member of this community and a frequent contributor to the ICT threads, has compiled a massive list of ICT Video Notes, and has offered his Notes as an addition to this Glossary. Naturally, I said, “Bring it on!”

His previous (and much smaller) list is currently [I]linked[/I] on page 4 of the Glossary. In the near future, that previous list will be blended into Peter’s main list, at which time all of his note-taking and indexing work will be right here on this thread.

But, you won’t have to wait for that to be done. Later this evening (New York time), I’ll add 2 new pages to the Glossary, and I’ll post Peter’s ICT Video Notes, just as he sent them today. Glossary pages 5 and 6 (posts 5 and 6 on this thread) will be devoted to his Notes.

Then, in the coming days and weeks, we’ll probably do some editing and re-formatting of the Notes. But, in the meantime (starting tonight), you’ll have everything you [I]need[/I] (and [I]just about[/I] everything you could [I]want[/I]) right at your fingertips.

Edit — see Page 1 of the Glossary for information about Peter’s Video Notes.

Peter and Clint, I do not understand how you gents do this, but I am extraordinarily grateful that you do and humbled by your extreme generosity…‘thank you’ seems rather inadequate for the amount of material and contributions you provide. It gives people like me the confidence to get started with a demo trading platform because of the legacy you give so altruistically. Your time is worth it. Thank you, Jacqui

Thank you, Jacqui.

A few people have been asking for the link below to the ICT Index Videos, also many thanks to Clint for his help.

http://forums.babypips.com/newbie-island/49172-glossary-ict-terms-abbreviations.html

I very much appreciate what Clint and yourself have done. It really helps a lot - thank you.