ICT Market Maker Model

The Inner Circle Trader (ICT) Market Maker Model is a concept in the world of Forex trading that suggests that the market is structured in a way that allows “market makers” or large institutions to manipulate price movements to their advantage.

This model is based on the premise that these entities have significant control over the Forex market due to their large trading volumes, which can influence market trends and liquidity.

According to the ICT Market Maker Model, these market makers follow a predictable pattern of behavior, often referred to as the “smart money cycle.” This cycle includes phases such as accumulation, manipulation, and distribution.

Basic of ICT Market Maker Model (MMMX)

Accumulation, Manipulation and Distribution are 3 main components of ICT MMM.

Accumulation: This phase involves market makers buying or selling their positions over time, without significantly moving the market price. Their goal is to accumulate a large position at favourable prices before the next market move.

Manipulation: In this phase, market makers may engage in activities that mislead or confuse other market participants. This often involves pushing the price to levels where many retail traders have placed their stop losses or are likely to enter the market, thereby creating liquidity for the market makers to fill their accumulated positions.

Distribution: After having accumulated their desired position, market makers then look to distribute or offload their positions at a profit. This is typically done by initiating a market move that triggers a broader market participation, allowing the market makers to sell their positions to the incoming wave of buyers or cover their shorts from the sellers.

The ICT Market Maker Model also emphasizes the importance of key levels in the market, such as key support and resistance levels, daily and weekly lows and highs. Smart money might use these levels to their advantage. Additionally, it suggests that by understanding and identifying the patterns and behaviors of market makers, retail traders can align their trading strategies accordingly to improve their chances of success.

PD Array( Premium and Discount): Identifies areas on the chart where “smart money” is interested in buying or selling, potentially causing a reversal or significant price movement. The reversal can be short-term or long-term, depending on the timeframe analyzed use IPDA (InterBank Price Delivery Algorithm) data ranges as refrence points for finding major key levels.

High Probability PD (Premium and Discount) Arrays: These are specific zones within the PD Array where the probability of a reversal is considered particularly high.

1. Order Blocks(OB)
2. Fair Value Gaps(FVG)
3. Liquidity(BSS,SSL)

• Order Blocks (Breaker + Mitigation): These are areas where the market maker places large orders to manipulate prices and trap retail traders.
• Liquidity (BSL, SSL): These are areas where the market maker accumulates orders to create a “false breakout” or “false breakdown” to trap retail traders and take liquidity. Learn what is Liquidity
• FVGS (BISI, SIBI): These are specific price levels where the market maker is likely to place large orders to manipulate price.

What is MMXM?

MMXM stands for “Market Maker Buy and Sell Model.” It’s a blueprint for predicting how price will behave when transitioning from a bullish PD Array to a bearish PD Array and vice versa. Understanding this model can help make trading decisions with tighter stop-losses and higher probability of success.

Market Maker Sell Model Steps:

1. Higher Time Frame (HTF) Market Structure: Confirm that the HTF market structure is bearish. This indicates the overall trend is down.
2. PD Array: Identify the next PD Array on the chosen timeframe (usually Daily or 4-hour). This is where “smart money” might be interested in selling and pushing the price lower.
3. DOL & Liquidity: Analyze the drawn-on Liquidity (DOL) and Liquidity zones (BSL, SSL) within the PD Array. This helps pinpoint potential entry and exit points for your trades.
4. Order Blocks & FVGS: Look for Order Blocks and FVGS levels within the PD Array. These can be used for confirmation of the sell model and for setting stop-loss orders.

Market Maker Buy Model:

The Market Maker Buy Model (MMBM) follows the same principles but in reverse. It’s used to identify potential buying opportunities when the market is transitioning from a bearish PD Array to a bullish PD Array.

Key points to remember:

• MMXM is a framework for understanding how “smart money” might influence the market.
• It’s important to use other technical analysis tools in conjunction with MMXM to confirm trade ideas.
• Always practice proper risk management and set stop-loss orders to protect your capital.

DOWN LOAD ICT Market Maker BUY/SELL MODEL PDF

Chart Example

The EURUSD chart above illustrates a market maker’s buying model. Prior to making any aggressive moves, smart money typically accumulates their orders, then strategically trap retail traders’ mindset to drive the market in the desired direction.