Structure and sessions: SMC, Session Liquidity, Trading Session
Structure and sessions: SMC, Session Liquidity, Trading Session
Three indicators that draw where price turned, which levels it took and when the sessions run. For each one, what it draws, how to read it and what it does not tell you. The SMC Setup Strength grade is a probability read on the structure, never a signal.
Indicators describe what price did. They do not tell you what to trade, and they do not predict what price will do next.
This lesson covers the three indicators that draw structure and time: where price turned, which obvious levels it took, and when each trading session runs. Install them first (lesson 13.2) if you want to follow along on your own MT5 demo chart.
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1 How to read any of these indicators
Every indicator in this module works the same way: it looks at candles that have already closed and draws what it found: a description of the past.
For each indicator you get three things:
- What it draws: the lines, boxes, markers and panels you will see.
- How to read it: what each object means, in plain words.
- What it does NOT tell you: a box, taken word for word from the indicator’s release notes. Read it every time. It is the easiest part to forget.
A marker means “this happened on this candle”. It never means “trade here”. What you do with a marker is decided by your trading plan (Module 11), with a stop-loss sized by the 1% rule (lesson 1.3), or not at all.
Quick check
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2 SMC / ICT Toolkit: structure, zones and sweeps
What it draws. Market structure: swings, BOS/CHOCH, order blocks, FVGs, liquidity pools and sweeps, plus a neutral Setup Strength gauge.
How to read it.
- BOS and CHOCH lines. A dashed line at a broken swing level, labelled BOS (blue, a break in the direction of the current structure, as in lesson 3.5) or CHOCH (orange, the first break the other way).
- Swings appear late. A swing high or low is only confirmed once 5 more candles have closed on its right (the default lookback). So a swing first shows up 5 candles after it happened. That is not a fault: it is what stops the indicator redrawing the past.
- Order blocks (OB). A filled box over the last opposite-coloured candle before a break. OB = not touched yet; OB(t) = price has come back into it. A box disappears once price closes through it.
- Fair value gaps (FVG). A box over a three-candle gap; FVG(p) once price has filled part of it.
- Liquidity lines and sweeps. Dotted lines at earlier swing highs and lows (gold when two sit at almost the same price). A cyan diamond marks a sweep: a wick went past one of those levels and price closed back on the other side within a few candles. If price stayed beyond the level, the indicator treats it as a break and draws no diamond.
Module 10 of the full course teaches these ideas from the ground up. The indicator only finds them for you; it does not decide whether they matter.
What it does NOT tell you: No entry/SL/TP plan, no BUY/SELL direction, no win-rate/track-record stats.
Quick check
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3 The Setup Strength grade is a probability read, not a signal
When the SMC toolkit finds the pieces of a structure lining up, its panel shows a grade such as Setup Strength: [B] 64/100. Only A+, A or B show by default; below that the row reads Setup Strength: — (set the InpMinGradeAlert input to C to see C; D never shows).
What the score adds up. Five things the toolkit can see on the chart, each worth some points: whether a recognised structure pattern formed (for example a sweep followed by a CHOCH the other way), whether an untouched order block is close by, whether a fresh fair value gap agrees, whether liquidity sits in that direction, and how clean the sequence of breaks is.
How to read it. Pipstone calls the grade a probability read: a quick summary of how many of the things structure traders look for are present at the same time. A higher grade means the structure is cleaner. That is all it means.
- It shows no direction and no price levels. It does not say buy or sell.
- It is not a forecast. No win rate is attached to any grade, and an A can be followed by price going straight the other way.
- It knows nothing about your plan, your risk or the news calendar. A major news release can push price through the cleanest structure (the full course covers news in lesson 6.4).
Read it as “the structure here is clean” or, on ”—”, “the structure here is messy”. Your plan still decides.
Quick check
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4 Session Liquidity Map: when the sessions run and which levels were swept
What it draws. ICT kill-zone boxes, PDH/PDL/PWH/PWL/Asia/session liquidity lines, daily Quarterly Theory tints, and a neutral cyan diamond where a level was swept and price closed back inside; dashboard.
How to read it.
- Kill-zone boxes. Shaded boxes over fixed hours of the day (in GMT): Asia, London, New York morning, London close and New York afternoon. A box grows with the high and low of its window. They mark time, nothing else.
- Liquidity lines. Horizontal lines at the previous day’s high and low (PDH, PDL), the previous week’s high and low (PWH, PWL), and the high and low of the Asian, London and New York sessions. These are obvious levels that many traders watch (lesson 2.4 covers previous highs and lows).
- Quarterly tints. The day split into four six-hour blocks, labelled Q1 to Q4. A way some traders label time. The tint is a label, not a prediction.
- Cyan diamond. A wick went past one of the lines and price closed back inside. The line turns grey and dotted once it has been swept.
Set the broker clock input (InpBrokerGMTOffset, lesson 13.2) or every box sits in the wrong hours.
What it does NOT tell you: Whether a sweep will reverse; no entry/stop/target; no performance claims.
Quick check
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5 Trading Session: the four sessions, shaded
What it draws. Shaded Sydney / Tokyo / London / New York session windows on the chart.
How to read it. Each session is a coloured block over its hours (in GMT, converted with the broker clock input). Where two blocks overlap, two markets are open at once: London and New York overlap in the GMT afternoon. The full course covers the trading hours in lesson 6.1.
This is the simplest indicator in the set, and a useful first one to install: if its blocks sit in the right hours, your broker clock setting is right for the others too.
What it does NOT tell you: Anything about direction or trade timing beyond when sessions are open.
Check your understanding
0 of 7 questions right. Answer them all to complete the lesson.