ICT Power Of Three

The ICT Power Of Three indicator provides a comprehensive implementation of the "Power Of Three" strategy, focusing on identifying market phases: Accumulation, Manipulation, and Distribution. It is designed to help traders align their positions with smart money concepts by detecting specific price action patterns across various algorithm modes.

Usage

The ICT Power Of Three indicator can be used to identify potential market reversals or trend continuations by analyzing institutional cycles.

• Accumulation Detection: When the indicator identifies a range where price is oscillating between tight pivot points, it highlights an accumulation zone. Traders look for this phase as the initial stage of a setup.
• Manipulation Detection: If the price breaks out of the accumulation range into a liquidity hunt (often hitting retail stops), the indicator marks a manipulation phase.
• Trade Execution: Following manipulation, the indicator projects a "shadow" distribution zone in the opposite direction. This signals a potential trade entry to follow the smart money move.
• Risk Management: The tool can plot dynamic or fixed Take-Profit (TP) and Stop-Loss (SL) levels to assist in trade planning.

Details

The strategy is built on the concept that market cycles consist of three distinct phases:

1. Accumulation: Smart money builds positions within a range. The script detects this by checking if the range of the last $X$ bars is smaller than the Average True Range (ATR) multiplied by a constant.
2. Manipulation: Price moves against the intended direction to generate liquidity. The script validates this when a bar wicks or closes beyond a specific ATR-based threshold outside the accumulation range.
3. Distribution: The primary move occurs. The indicator automatically forecasts this phase once manipulation is confirmed, helping traders capitalize on the "real" market direction.

Settings

General Configuration

• Algorithm Mode: Choose between Small Manipulation (detects slight imbalances), Big Manipulation (requires heavy price action imbalances), or Short Accumulation (for highly volatile assets).
• Breakout Method: Determines whether a "Close" or a "Wick" is required to validate range breakouts.

TP / SL

• TP / SL Method: Toggle between "Fixed" (manual percentages) or "Dynamic" (calculated by the algorithm).
• Risk: Adjusts the distance of dynamic levels; higher risk settings accommodate higher volatility.
• Take Profit / Stop Loss %: Manual inputs for the "Fixed" method.

Visuals & Alerts

• Show Zones: Toggles the visibility of Accumulation (blue) and Manipulation (blue/shaded) zones.
• Buy/Sell/TP/SL Alerts: Enable specific alerts for different stages of the strategy execution.

FAQ

How can I access the ICT Power Of Three indicator?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.

What is the difference between the Algorithm Modes?

The modes adjust the sensitivity of the detection logic. For example, "Short Accumulation" is optimized for assets that don't range for long periods, while "Big Manipulation" helps filter out noise on highly liquid assets.

Does the indicator repaint?

The indicator calculates based on confirmed bars to ensure that accumulation and manipulation zones are validated by price action before signals are generated.