Models
ICT 2022 Model Explained: A Practical Guide
The ICT 2022 model is a trading model associated with the ICT methodology. Explanations can vary, so this guide focuses on the commonly described sequence and emphasizes defining each condition before backtesting.
Core idea
A commonly taught sequence combines directional context, a liquidity event, a market-structure shift or displacement, and an entry around a Fair Value Gap or related price-delivery concept.
Define the liquidity event
Decide in advance which high or low qualifies as the liquidity reference. Avoid changing the reference after seeing the outcome.
Define the entry
Write down the exact confirmation, FVG condition, stop placement and target before testing. This turns a visual idea into a repeatable model.
Backtest before risking capital
Record every qualifying setup across a fixed sample. Measure win rate, average R, drawdown and rule adherence rather than judging the model from a few attractive examples.
Worked example (hypothetical)
Turn each stage into a checklist with an observable condition: higher-timeframe context, selected liquidity reference, chosen session window, entry trigger, invalidation and target. For each chart, mark which conditions were present before entry and which were absent. If the planned trigger does not occur, record a no-trade outcome. Keep your definition of a structure shift or FVG fixed across examples. This helps distinguish a complete setup from a story assembled after the move, and makes the full sequence possible to review consistently.
FAQ: Are all five model steps required on every trade?
Follow the exact version of the model you are testing. If a condition is a required rule, absence of that condition means the setup does not qualify under that version. Do not silently substitute another confirmation after seeing the outcome.
FAQ: Does a completed sequence predict a winning trade?
No. A sequence can satisfy the model’s checklist and still lose. Define invalidation and risk before entry, record qualifying and skipped cases, and measure net results including costs.
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