ICT Trading Strategy: From Concepts to Rules

Which ICT concepts does this setup use?

Huddleston identifies himself as The Inner Circle Trader on his official website, linked in the sources below. The rules here are an explicit interpretation for testing, rather than a transcription of his teaching. The previous session low is a reference price; calling it sell-side liquidity does not establish how many stop orders actually rest there. Likewise, a price reversal cannot establish who traded or why. The linked FVG and SMC guides cover indicator definitions and variations; this page focuses on sequencing one strategy.

• Liquidity sweep: a completed bar trades below the frozen previous session low and closes back above it.
• Structure shift: a later bullish bar closes above a frozen five-bar high. This rolling-high proxy is our chosen definition, not a confirmed swing-pivot algorithm.
• Displacement: that bullish bar has a range at least as large as the mean range of its previous 20 completed bars, and closes in the top quarter of its own range.
• Bullish FVG: three consecutive completed candles have the third low above the first high; the middle candle must be the displacement bar. Use wick boundaries.
• Excluded filters: order blocks, OTE retracements, higher-timeframe bias, and PO3 are not extra entry requirements in this version.

One complete ICT strategy trading rule set

Use standard five-minute OHLC candles and one fixed symbol and data feed. The illustrative session is a US equity-style 09:30 to 16:00 session in America/New_York, with new setups allowed only before 11:00. These hours are a test choice, not a universal ICT killzone. Skip shortened sessions, missing reference sessions, or insufficient history. Use the preceding completed full session low, not an unfinished daily candle or a calendar-day low from a different feed.

A hypothetical sweep-to-gap example

Assume the previous full session low is 99.00, the five-bar high frozen at the sweep is 100.80, the mean range before displacement is 1.00, and tick size is 0.01. The table uses invented prices to check the rules, not historical market data. Times are New York bar-opening times; each event becomes known five minutes later at the close.

• Planned entry is 100.20; stop is 98.79; planned price risk is 1.41; the fixed target is 103.02 before costs.
• If C low were 99.90, no bullish gap would exist. The earlier sweep and structure break would still not authorize an entry.
• If no subsequent bar reached the limit, cancel at 10:05 after three active bars. Do not count a missed entry as a zero-return filled trade.
• If the sweep happened late enough that gap confirmation arrived at 11:00, discard it even if the price pattern otherwise qualified.

Confirmation time and fill time must stay separate

A developing candle can lose its qualifying close or gap before it finishes. This specification waits for closed bars and never backdates an entry to the displacement candle. A swing-pivot replacement would need its own confirmation delay; drawing a pivot on an earlier bar does not make it knowable then. TradingView also distinguishes exchange time from chart display time, so specify America/New_York in session logic rather than relying on the visible chart clock.

• With default strategy behavior, a new order can first fill on the next available tick. A limit order then waits for an eligible price; it need not fill at the next open.
• An existing limit can fill before a later close invalidates the setup. A cancellation evaluated at that close cannot undo the fill; the attached exit rules govern the position.
• Historical OHLC leaves intrabar order ambiguous. If entry and stop are both touched, review the broker emulator assumptions and available lower-timeframe detail.
• Use standard candles for this experiment. Synthetic chart prices change the signals and can distort simulated fills.
• Record commission, spread treatment, slippage, limit-fill assumptions, and session-end exit timing. The example supplies no live execution evidence.

Test the rules before tuning them

First compare expected events with the script on individual candles: session reset, frozen levels, sweep, displacement, gap confirmation, order submission, fill, cancellation, and exit. Then evaluate a fixed historical period with costs and reserve a later period for an unchanged test. A favorable result on selected screenshots cannot establish that the setup works.

• Count attempted sweeps, confirmed gaps, expired orders, filled trades, and net outcomes separately. This shows which filter removes opportunities.
• Inspect sessions with continuation through the previous low, fast reversals without a gap, and gaps that never retrace. All can defeat this particular sequence.
• Compare a small, declared set of structure lookbacks or entry-expiry lengths. Keep the session definition and cost model fixed across runs.
• Report drawdown, average net trade, trade count, and results on the untouched period. Selecting the highest historical return does not establish future performance.

Translate the sequence into a strategy with Pineify

Pine Script AI Coding Agent can draft a strategy from the rule table. Include the frozen levels, event order, one-attempt limit, and session reset in the request. Review the output against the hypothetical candles before relying on its report. After the strategy exposes supported inputs, Strategy Optimizer can compare parameter combinations in TradingView through the Pineify browser extension. Parameter search evaluates the implemented rules; it cannot determine whether a discretionary ICT label was translated correctly.