SMC Sessions and Cycles

Source: David Woods, Advanced ICT Institutional SMC Trading Book — Sessions and Cycles Chapter

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Daily Cycle

The Daily Cycle is a trading framework that divides the 24-hour period into three major sessions. Each session carries a distinct role and set of characteristics, directly reflecting the patterns through which institutional algorithms acquire liquidity. In SMC trading, "when you trade" is just as important as "what you trade" — understanding the daily cycle allows you to anticipate the market's function at each time of day.

3-Phase Cycle Structure

1. Asia Session: Liquidity accumulation phase — forms a narrow range, establishing highs and lows that become targets for subsequent sessions.
2. London Session: Trap formation followed by the main attack — executes a Frankfurt fake move before driving aggressively in the true direction.
3. New York Session: Directional completion or additional traps — either finishes the move London initiated or creates a new trap.

Core Principles

• The highs and lows formed during Asia act as sweep targets for the London and New York sessions.
• Each session's role is structurally fixed, but volatility and intensity vary depending on market conditions.
• The daily cycle resets when the next Asia session opens.
• Statistical fact: In approximately 90% of cases, the High of Day (HOD) or Low of Day (LOD) is formed during the London or New York session. In other words, it is extremely rare for the HOD/LOD to be established during the Asia session.

D.O (Daily Opening Price) Analysis

The Daily Opening Price is the key reference level for determining the premium/discount zone for the day. It uses the opening price at New York midnight (00:00 EST). Whether price is trading above or below this level determines the buy/sell bias.

Position	Zone	Meaning	Trading Bias
Above D.O	Premium Zone	Increased selling pressure	Look for short opportunities
Below D.O	Discount Zone	Increased buying pressure	Look for long opportunities

Practical Tip: The D.O level is most effective when combined with HTF bias (bullish/bearish) rather than used in isolation. For example, if the HTF bias is bullish and price is below the D.O, a long entry from the discount zone offers a high-probability setup.

Validation Rules

✅ Required Confirmations

• Asia: Liquidity accumulation phase — confirm range formation
• Frankfurt: Fake move phase — confirm FFH (Frankfurt Fake High) or FFL (Frankfurt Fake Low) formation
• London Open: Aggressive liquidity grab → true directional move begins
• New York: Potential trap → either completes the London direction or attempts a reversal
• D.O Reference: Confirm premium/discount positioning to establish bias

Practical Application

1. Identify Session Role: First determine which session is active and what its designated function is.
2. Set D.O Level: Plot the New York midnight opening price as a horizontal line on your chart each day.
3. Map Liquidity: Mark the Asia session high/low as potential sweep targets for London and New York.
4. Probability-Based Approach: Use the 90% statistic to remember that Asia session extremes are unlikely to be the day's HOD/LOD.
5. Monitor Session Transitions: Focus especially on the 30 minutes surrounding London Open (08:00 GMT) and New York Open (09:30 EST).

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Asia Session

The Asia session is the liquidity accumulation phase, responsible for building the liquidity pools that London and New York will exploit. It is characterized by small price ranges and the absence of clear trends — the range established during this session becomes the trading map for subsequent sessions.

Key Characteristics

• Time Window: Tokyo Open (19:00 EST) through pre-London Open (approximately 00:00–08:00 GMT)
• Liquidity Grade: Generates medium-level liquidity — meaningful enough to serve as sweep targets
• Price Action: Consolidates within a relatively confined range, forming clearly defined highs and lows
• Crypto-Specific Note: Unlike traditional forex markets, cryptocurrency trades 24/7, so the Asia session can occasionally produce significant moves. However, on average, volatility remains lower compared to London and New York.

Liquidity Classification System

Level	Location	Characteristics	Application
Minor	Asia range midpoint (50%)	Small bounce/retracement point	Short-term scalping target
Medium	Asia high/low	Major reversal point	Day trading sweep target

Key Pattern Analysis

The Asia Low Sweep Pattern is the most frequently observed inter-session pattern:

• A rapid sweep of the Asia low at London Open followed by a strong reversal is a common occurrence.
• After the sweep, price tends to move toward the Asia high (or beyond).
• This represents institutions deliberately hunting the buy stops accumulated during the Asia session.
• Conversely, an Asia High Sweep followed by a decline also exists — the direction is determined by the day's HTF bias.

Validation Rules

✅ Asia Session Validation Checklist

• Have you clearly identified the Asia range high and low?
• Have you marked the range midpoint (50%) as a Minor liquidity level?
• Have you classified the Asia high/low as Medium liquidity?
• Are you monitoring for Asia extreme sweeps around London Open?
• Have you confirmed whether an impulse in the opposite direction occurs after the sweep?

Practical Application

1. Range Identification: Before the Asia session ends, plot horizontal lines at the high and low on your chart.
2. Midpoint Setup: Calculate the 50% level of the Asia range and mark it as a Minor liquidity level.
3. Await Sweep: Focus on whether the Asia high or low is breached around London Open.
4. Confirm Reversal: Look for a rapid pullback (wicking) and a strong impulse candle in the opposite direction after the sweep.
5. Set Targets: When entering long after an Asia low sweep, set the Asia high as the first target and higher liquidity levels as secondary targets.

Trading Strategy

• Conservative Approach: Avoid active trading during the Asia session; focus on level identification and scenario building.
• Preparation Phase: Pre-build your liquidity map and directional bias for the London and New York sessions.
• Sweep Utilization: Asia extreme sweeps are among the highest-confidence inter-session entry signals.

Caution: On days when the Asia range is abnormally wide (due to news events, etc.), subsequent sessions may retrace into the range rather than extending beyond it. Always check the range width before setting your expectations.

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London Session

The London session is the core phase where the Daily Major Move occurs. Approximately 35–40% of global forex volume is concentrated in the London time zone, and cryptocurrency markets also experience significant increases in liquidity and volatility during this window. Following the Frankfurt fake move, aggressive liquidity acquisition takes place at London Open.

Session Structure

1. Frankfurt Phase (07:00 GMT): Fake move occurs — price moves first in the direction opposite to the true intention
2. London Open (08:00 GMT): Aggressive shift into the actual directional move
3. London Progression: Achievement of major liquidity targets and formation of the day's HOD/LOD

Key Patterns

• Trap and Reverse: Frankfurt fake → London true directional reversal
• Liquidity Sweep: Targeting Asia extremes and Previous Day High/Low (PDH/PDL)
• Strong Impulse: A significant portion of the day's maximum range is established during this window

Frankfurt Fake Move Analysis

Characteristics of FFH (Frankfurt Fake High):

• According to the source material, the Frankfurt phase consistently produces a fake move (specifically FFH).
• This phase breaks upward, luring retail traders into long positions.
• Immediately after London Open, a sharp reversal occurs, hunting the stops of those induced positions.

Practical Note: The statement that fake moves "always" occur refers to a very high frequency, not a literal 100% occurrence on every trading day. Always confirm with price structure validation (BOS, momentum shift).

London Open Strategy

Multi-Target Sweep:

• When both the Asia low and PDL (Previous Day Low) are swept simultaneously, two liquidity pools are captured at once, generating stronger reversal momentum.
• When this multi-target sweep occurs, the probability of forming the LOD (Low of Day) increases significantly.
• When FVG (Fair Value Gap) and OB (Order Block) are located near the sweep zone, confluence is strengthened and entry confidence rises.

4-Stage London Pattern

1. Build: Frankfurt prepares the price structure for the fake move.
2. Induce: FFH lures retail traders into the wrong direction.
3. Trap: Induced traders accumulate positions in the wrong direction.
4. Shift: A powerful move in the true direction begins, producing a BOS.

Validation Rules

✅ London Session Validation Checklist

• Confirm whether a fake move (FFH) occurred during Frankfurt
• Check whether the Asia low + PDL were swept at London Open
• Focus monitoring on LOD/HOD formation potential during this session
• Verify that the Build → Induce → Trap → Shift pattern progresses in sequence
• Confirm that BOS or momentum shift accompanies the move

Monitoring Points

• Time Window: Focus observation on the 30 minutes around London Open (07:30–08:30 GMT).
• Directionality: Verify whether London moves in the opposite direction of the Frankfurt move.
• Intensity Assessment: Distinguish real moves from fake moves using candle body size, wicking patterns, and volume.
• Structural Change: The occurrence of BOS (Break of Structure) determines the validity of the London direction.

Practical Trading Guide

1. Pre-Session Preparation: Plot the Frankfurt FFH level and Asia high/low on your chart in advance.
2. Wait for Entry: Wait until the fake move reversal is confirmed after London Open. Premature entries risk getting trapped.
3. Stop Loss: Place above the FFH (for short positions) or above the Asia high for structural protection.
4. Target Setting: Arrange partial take-profit targets in sequence: PDL → previous day key levels → Asia low.
5. Risk Management: If no reversal is confirmed within 30 minutes of London Open, invalidate the setup and reassess.

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New York Session

The New York session either completes the direction London initiated or forms a new trap. Traps occurring around the NY Open are accompanied by fake BOS (Break of Structure), which is a signature pattern used to induce retail traders.

Two Scenarios

1. London Direction Continuation (~70% probability): New York provides additional momentum as an extension of the London move, achieving the day's final targets.
2. NY Open Trap (~30% probability): A fake BOS induces a reversal, shaking out late-entry traders who followed the London direction.

Key Decision Criterion: Whether the primary liquidity target was already achieved during London is a critical clue for predicting the New York scenario. If the target remains unmet, continuation probability is high; if already achieved, trap/reversal probability increases.

NY Open Trap Mechanism

Fake Supply/Demand Zone Formation:

• Fake Supply Zone: During an uptrend, a sudden drop creates a zone that resembles a supply level. Retail traders perceive it as genuine resistance and enter short.
• Fake Demand Zone: During a downtrend, a sudden bounce creates a zone that resembles a demand level. Retail traders perceive it as genuine support and enter long.
• In both cases, once induced positions accumulate, price resumes in the original direction, liquidating the stops.

Fake BOS Characteristics

Relationship with Momentum Shift:

• NY traps are always accompanied by a fake BOS (disguised as a momentum shift).
• It appears to be a structural break, but is actually a temporary price manipulation.
• How to distinguish from real BOS: A real BOS shows the broken level acting as support/resistance on retest. A fake BOS returns to the original price zone rapidly (typically within 15 minutes).

HOD/LOD Formation Patterns

New York Session Extreme Characteristics:

• If London formed the LOD, the HOD is likely to form during New York.
• Conversely, if London formed the HOD, the LOD may form during New York.
• This demonstrates the complementary structure where New York completes the direction London started.
• As the final completion stage of the daily cycle, the day's range is established in the latter portion of the New York session.

Validation Rules

✅ New York Session Validation Checklist

• Confirm whether fake supply/demand zones formed during the NY Open trap
• Check whether the NY trap is accompanied by a fake BOS (momentum shift)
• Verify whether New York is completing the direction London initiated
• Monitor for HOD or LOD formation potential
• First check whether London's primary target was achieved

Practical Confirmation Method

Step	Confirmation Element	Reliability Assessment
Step 1	Strong breakout immediately after NY Open	Analyze breakout candle body size and volume
Step 2	BOS occurs with simultaneous momentum change	Confirm whether the structural change persists in subsequent candles
Step 3	Rapid pullback and opposite-direction impulse	If price returns to origin within 15 minutes, trap is confirmed

Trading Strategy

Conservative Approach (Recommended for Beginners):

• Observe only for the first 30 minutes after NY Open.
• Consider opposite-direction positions only after trap confirmation (return to origin within 15 minutes).
• Setups aligned with the London direction offer safer entries.

Aggressive Approach (Experienced Traders Only):

• Attempt counter-directional entry immediately upon recognizing the fake BOS pattern.
• Manage risk with tight stop losses (beyond the fake BOS high/low).
• Target quick profit realization while keeping the possibility of further extension in the London direction open.

Caution: During the late New York session (especially after 2:00 PM NY time), liquidity drops sharply and spreads can widen. Avoid initiating new positions during this window and focus on managing existing positions.

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90-Minute Cycle

The 90-minute cycle is a time-based pattern where price volatility risk increases at precise 90-minute intervals starting from New York midnight (00:00 EST). In ICT/SMC theory, institutional algorithms are believed to recalibrate on 90-minute intervals, and the opening price of each interval can be used to identify fake moves.

Cycle Structure

• Reference Point: New York midnight 00:00 EST
• Interval: Exactly 90 minutes (00:00, 01:30, 03:00, 04:30, 06:00, 07:30, 09:00, 10:30, 12:00, 13:30, 15:00, 16:30, 18:00, 19:30, 21:00, 22:30)
• Core Concept: Volatility rises at each 90-minute transition point, where new directional decisions may be made.

Opening Price Analysis System

Opening Price Setup Principles:

• The opening price of the first candle in each 90-minute interval is set as the reference level for that interval.
• This level becomes the benchmark for identifying fake moves during the 90-minute window.
• Traps are identified through the direction of deviation from the opening price and the subsequent retracement pattern.

Fake Move Identification Method

Opening Price Deviation Patterns:

1. Upward/Downward Deviation: A strong break above or below the opening price — suspect a potential fake move.
2. Rapid Retracement: Price returns to the opposite side of the opening within 15–30 minutes — fake move confirmed.
3. Reversal Impulse: After the retracement, a strong impulse candle in the true direction appears.

Combining with Sessions: The 90-minute cycle is most effective when combined with session context rather than used in isolation. For example, the 07:30 interval overlaps with the Frankfurt Open, potentially creating a confluence between the FFH pattern and the 90-minute cycle.

Validation Rules

✅ 90-Minute Cycle Validation Checklist

• Confirm the starting point is NY midnight (00:00 EST)
• Have you set the opening price for each 90-minute interval precisely?
• Are you observing deviation direction and retracement relative to each interval's opening price?
• Are you paying special attention to 90-minute intervals that overlap with session transitions?

Practical Application Guide

1. Time-Based Mapping: Plot horizontal lines for each 90-minute interval opening price on your chart. TradingView session separators or custom indicators can simplify this.
2. Monitor Deviations: When a strong deviation from the interval opening occurs, immediately suspect a fake move.
3. Confirm Retracement: If a rapid retracement occurs within 15–30 minutes, prepare for a reversal entry.
4. Track Impulse: Once the true direction is confirmed, switch to a trend-following strategy.
5. Risk Management: Tighten stop management on existing positions at each 90-minute transition point.

Cautions

• Fake moves do not occur at every 90-minute interval. Statistically, they are more frequent at intervals overlapping with session transitions (07:30, 09:00, 13:30, etc.).
• During major economic data releases (FOMC, CPI, NFP, etc.) or significant news events, the 90-minute pattern can be completely invalidated.
• Always combine with session patterns, liquidity levels, and HTF bias for comprehensive analysis.

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Weekly Cycle

The weekly liquidity cycle is a structured pattern across the Monday–Friday 5-day period, where institutional algorithms perform different roles on each day. Understanding this pattern provides a strategic framework for when to initiate trades and when to close positions.

5-Day Cycle Structure

Day	Role	Characteristics	Trading Priority
Monday	Manipulation (Liquidity Engineering)	Initial manipulation for direction setting; high frequency of weekly high/low formation	⚠️ Observation mode
Tuesday	Order Accumulation	Actual order collection phase; hints at the true direction	✅ Consider first entry
Wednesday	Re-accumulation / Reversal	Additional liquidity acquisition or HTF-based direction change	✅ Key decision day
Thursday	Wednesday Completion	Completion stage of Wednesday's pattern; weekly target achievement	✅ Primary trading day
Friday	Distribution	Weekly position unwinding and profit realization	⚠️ Position management

Case 1: Standard Bullish Pattern

• Monday: Manipulation creates directional confusion — the weekly low is frequently formed on this day.
• Tuesday: Buy orders accumulate based on Monday's low; the upward move begins.
• Wednesday: Re-accumulation phase — a temporary pullback followed by further upside, or an HTF-based reversal.
• Thursday: Completes Wednesday's pattern and approaches the weekly high.
• Friday: Distribution (unwinding) of weekly positions as the week concludes.

Case 2: Advanced Manipulation Pattern

• Monday: Liquidity engineering — intentional accumulation conceals the true direction.
• Tuesday: A manipulation sweep takes out both Friday's high and Monday's high simultaneously.
• Wednesday/Thursday: A wide range forms as large-scale orders are accumulated.
• Friday: The accumulated orders determine the direction, or the weekly low is formed.

Monday Characteristics Analysis

The Core of Liquidity Engineering:

• Monday is the day when intentional price manipulation creates directional confusion.
• It lures retail traders into prematurely determining "this week's direction."
• The primary objective is to accumulate liquidity while concealing the true direction.
• Statistical Characteristic: The weekly high or low is formed on Monday with higher frequency compared to other days. In other words, Monday's extreme often becomes the final extreme for that week.

Validation Rules

✅ Weekly Cycle Validation Checklist

• Case 1: Mon = Manipulation, Tue = Order accumulation + continuation, Wed = Re-accumulation (or HTF-based reversal), Thu = Wednesday completion, Fri = Distribution
• Case 2: Mon = Liquidity engineering, Tue = High sweep (manipulation), Wed/Thu = Range (accumulation), Fri = Direction decision / low formation
• Retroactively verify whether the weekly high/low was formed on Monday for pattern learning
• Make the initial Case 1 vs. Case 2 assessment by the end of Tuesday

Practical Application Strategy

Day-by-Day Trading Approach:

Monday:

• Approach in observation mode; avoid direct position entry.
• Analyze manipulation patterns to formulate weekly scenarios (Case 1 vs. Case 2).
• Monitor for weekly high/low formation and mark those levels on your chart.

Tuesday:

• Consider your first position based on Monday's analysis.
• Pay attention to moves in the direction opposite to Monday's manipulation.
• Combine with the daily cycle to assess bullish/bearish continuation.

Wednesday:

• Re-evaluate the validity of existing positions at the re-accumulation stage.
• Review the possibility of an HTF-based reversal; reassess direction if necessary.
• "Wednesday reversal" is one of the most important inflection points in the weekly cycle.

Thursday:

• Track the completion stage of Wednesday's pattern.
• Confirm whether the weekly target has been achieved; consider partial profit-taking upon target completion.
• Prepare a position management plan in anticipation of Friday's distribution.

Friday:

• Prioritize position unwinding. Account for weekend risk (especially relevant for crypto, which trades 24/7).
• Confirm whether the weekly cycle has completed and document the results.
• Begin preparing scenarios for the following week.

Crypto-Specific Note: Unlike traditional financial markets, cryptocurrency markets remain open over the weekend. However, weekend liquidity is significantly lower than weekday levels, so the weekly cycle "distribution" remains concentrated on Friday. Weekend price action may be absorbed as part of the following Monday's manipulation.

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HTF Cycle (Higher Time Frame Cycle)

The HTF liquidity cycle operates on 20/40/60/90-day intervals as a long-term algorithmic pattern. While the daily and weekly cycles function at the tactical level, the HTF cycle operates at the strategic level. After institutions capture significant liquidity, they target historical highs and lows as long-term objectives, executing plans that span weeks to months.

Algorithm Classification System

Dual Algorithm Structure:

• Short-Term Algorithm: Handles the daily and weekly cycles at the execution level — directly applied to day trading and swing trading
• Long-Term Algorithm: Manages the HTF liquidity cycle at the strategic level — applied to position trading and overall bias setting

Core Principle: The short-term algorithm always operates within the direction of the long-term algorithm. This is why short-term setups aligned with the HTF direction produce the highest probabilities.

Cycle Period Characteristics

Period	Characteristics	Target Setting	Probability	Key Events
20 Days	Monthly base cycle	Recent monthly extremes	High	Month-end/month-start rebalancing
40 Days	Seasonal adjustment window	Quarterly key levels	Medium	Mid-quarter reassessment
60 Days	Quarterly reassessment	Semi-annual trend points	High	Quarterly settlement effects
90 Days	Long-term trend confirmation	Annual key levels	Highest	Seasonal trend transitions

Target Setting Mechanism

Time Lookback Method:

1. Identify the point where Major liquidity was captured from the current position.
2. Analyze the chart 20/40/60/90 days back from that point.
3. Set the highest high and lowest low within each period as long-term targets.
4. Once BMS (Break of Market Structure) is confirmed, execution toward those targets begins.

20-Day Cycle Special Analysis

Post-Trap Reversal Pattern:

• After a large-scale trap, the probability of reversal increases sharply around the 20-day mark (±3 days).
• This corresponds to the natural rhythm of the monthly cycle and aligns with institutional monthly rebalancing intervals.
• Practical Application: Record the timestamp of each trap and focus monitoring on reversal signals during the window around 20 days later.

Liquidity Capture Sequence

Systematic Approach:

1. Current Analysis: Identify significant liquidity levels and classify them as already captured or still outstanding.
2. Historical Mapping: Analyze the relationship with past highs/lows on HTF charts (daily, weekly).
3. Target Setting: Establish key levels within 20/40/60/90-day windows as staged targets.
4. Short-Term Integration: Build a plan for progressively approaching HTF targets through daily and weekly cycles.

Validation Rules

✅ HTF Cycle Validation Checklist

• Confirm whether the Major liquidity capture + structural break (BMS) → target setting process is underway
• Verify whether the highs/lows from the past 20/40/60/90 days are actually functioning as targets
• Focus monitoring on the ~20-day mark after a large-scale trap for reversal potential
• Always confirm a momentum shift (MS) before determining HTF direction
• Validate alignment between the short-term cycle direction and HTF direction

Practical Monitoring System

Stage 1: Liquidity Identification

• Mark significant liquidity capture points on your chart.
• Classify each liquidity level's importance as Minor/Medium/Major.

Stage 2: Distance Measurement

• Measure the distance to historical extremes on HTF charts (daily/weekly).
• Set target levels for each 20/40/60/90-day timeframe.

Stage 3: Completion Forecasting

• Record expected cycle completion dates on your calendar.
• Prioritize confluence zones where cycles from multiple timeframes overlap.

Stage 4: Response Preparation

• Pre-plan multiple scenarios for target achievement: partial profit-taking, full exit, counter-directional entry, etc.
• Establish a risk management plan for each scenario.

HTF and Short-Term Cycle Integration

Multi-Timeframe Approach:

• Set the HTF direction as the main trend (bias). This serves as the compass for all short-term trades.
• Execute daily and weekly cycle trades only within the HTF direction. Counter-directional setups carry lower probability and should be avoided.
• When short-term pullbacks occur against the HTF direction, treat them as re-entry opportunities from the HTF perspective.

Example: If the HTF 90-day cycle points bullish, interpret downward corrections in the daily cycle as long re-entry opportunities. Even if Monday's manipulation in the weekly cycle moves downward, anticipate that the uptrend will resume Tuesday through Thursday.

Cautions and Risk Management

HTF Cycle Limitations:

• Completion may take longer than anticipated; patience is essential.
• Significant drawdowns can occur during the process, and oversized positions amplify psychological pressure.
• Patterns can be disrupted by macroeconomic shifts, regulatory news, or black swan events.

Mitigation Strategies:

• Size positions conservatively to manage time risk.
• Protect capital through partial profit-taking at intermediate stages.
• If the fundamental environment changes significantly, immediately reassess existing HTF analysis.
• Even for HTF cycle-based positions, always pre-define a stop loss level.