The ICT (Inner Circle Trader) Optimal Trade Entry (OTE) is a trading concept developed by Michael J. Huddleston, focusing on precision entry points within the Forex market. This strategy leverages the natural retracement phases of price movements to identify high-probability entry points for trend continuation trades.
How ICT OTE Strategy Works?
In any financial market, prices don’t move in a straight line but rather in waves, consisting of impulse moves and retracements. An impulse move is a primary trend direction move (upward in a bull market, downward in a bear), and a retracement is a smaller counter move against this trend.
The ICT OTE strategy focuses on entering the market during these retracements, which are considered natural and healthy for continued trends.
What is the Fibonacci OTE value?
The core of the ICT OTE model is the use of Fibonacci retracement levels to identify where the retracements might halt and the trend might resume. The key Fibonacci levels used in the ICT OTE model are:
- 61.8% (The Golden Ratio): This level is widely regarded as the most critical retracement level, where the market often resumes the prevailing trend.
- 70.5% and 79%: These are deeper retracement levels that may provide entry opportunities if the price retraces more significantly but still within the context of a continuing trend.
How to use ICT Fibonacci retracement?
When the price retraces into the OTE sweet spot, traders look for additional confirmation signals (like order blocks, fvg, liquidity sweep) before executing a trade. Entry at these levels allows for a tighter stop-loss (placed just beyond the retracement area) and more substantial profit targets aligned with the continuation of the trend.
ICT Fibonacci Levels
ICT Fib level are those level where we can find optimal trade entry(OTE). These level and their descriptions are given below.
| 0 | First Profit Scaling |
| 0.505 | Equilibrium (50% level) |
| 0.618 | 62% Retracement |
| 1.0 | 100% (original position) |
| 0.705 | Optimal Trade Entry (OTE) |
| 0.79 | 79% Retracement |
| -0.62 | Target 2 |
| -0.27 | Target 1 |
| -1 | Symmetrical Price |
ICT Fib Settings Tradingview
For setting ict Fibonacci level on trading view do the following
Set up Fibonacci Settings: Click on the Fibonacci retracement tool in your trading platform.Place it on the chart by clicking and dragging from the swing high to the swing low (or vice versa) that you want to use as reference points.
Adjust Fibonacci Levels: Double-click the Fibonacci retracement tool on the chart. Right-click on the tool to access the settings. Go to “Fib levels” and modify the levels as follows:
After setting the levels, click “Save” to apply the changes.
How to Apply ICT Fib Settings on Chart
In the ICT trading strategy, when using Fibonacci retracement levels, we place the tool from the lowest point to the highest point of the candle’s body if the market is going up (bullish momentum) and from higer to lower in bearish momentum.
We do this because the highs and lows of candles can differ between brokers, making them less reliable. By focusing on the bodies of the candles, we can find the best spot to enter a trade with good profit potential, regardless of the broker we use. This helps us make better trading decisions and increases the chances of successful trades.
How should I position my stop-loss orders for a trade that anticipates a price rise?
For a trade anticipating a price increase, it’s wise to position stop-loss orders just below the selected Fibonacci levels. This approach helps protect against potential losses if the market moves in the opposite direction. By setting stop-losses beneath these key Fibonacci retracements, traders can manage risk while giving the trade enough room to move in the anticipated upward direction.
What are the ideal Fibonacci (FIB) levels to consider when entering a trade?
The ideal Fibonacci levels for entering a trade are typically in the range of 0.62 to 0.79. These levels are considered strategic points for making trade decisions because they often represent significant support or resistance levels within the market. By aligning trade entries with these Fibonacci retracements, traders aim to enter the market at points where a
What strategies can I use to refine my entry points with Fibonacci levels?
To refine your entry points using Fibonacci levels, focus on the specific retracement levels between 0.62 and 0.79. These levels are particularly useful for identifying potential reversal points in the market and combined with premium and discount arry. By waiting for the price to reach these levels and showing signs of reversal, such as through candlestick patterns or other technical indicators, you can optimize your entry points. This strategy aims to increase the likelihood of entering the trade at a more favourable price, thereby enhancing the profit potential.
What is the ote in ICT concept?
In ICT trading methodology optimal trade entry is a method to enter on the trade upon retracement. Its help the trader to execute trade in the direction of trend when price is retraced back.
