Explained ICT Daily Bias: Meaning and Trading Strategy

Welcome to our in-depth guide on ICT Daily Bias! Whether you’re new to Forex trading or aiming to sharpen your strategies, understanding Daily Bias is like having a compass for your trading journey. Picture starting each trading day with a clear sense of whether the market is likely to go up (bullish) or down (bearish).

How to Find ICT Daily Bias

Finding the daily bias is a straightforward process. Start by analyzing higher time frames, such as the weekly and daily charts. Determine whether the price is in a premium or discount zone. Identify the next draw on liquidity—whether the IPDA targets the sell-side liquidity or buy-side liquidity. Check if any PDA array matrix is encountered.

Step by Step Process of Finding Daily Bias

Determine Order Flow

On higher time frames, identify the order flow. Order flow represents the direction in which smart money is investing or moving the price.

The above weekly chart of GBPUSD show that pound is in up trend.

Finding Next Drawn on Liquidity

To find the next draw on liquidity on a chart, follow these simple rules:

1. Price moves from sweeping sell-side liquidity to sweeping buy-side liquidity, or vice versa.
2. Price moves from internal range liquidity to target external range liquidity.
3. Price moves from external range liquidity to internal range liquidity.

It is clear from the above chart that the price is moving from internal range liquidity( weekly fair value gap) to target the external range liquidity. This is visible on the chart in the form of equal highs at the price level of 1.31585.

Check Price is in Premium or Discount Zone

1. If the price is in the premium zone, take sell trades.
2. If the price is in the discount zone, open long positions.

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1. The daily chart of GBPUSD shows that the price is in the Optimal Trade Entry (OTE) zone.
2. On the daily time frame, a bullish Fair Value Gap (FVG) or an order block is present.
3. Therefore, we should wait for a deeper price retracement before opening buy trades.

Entry on Lower Time Frame

• The above chart of the Pound on the hourly time frame shows that the price is in the daily Fair Value Gap (FVG) and has swept the sell-side liquidity.
• After sweeping the sell-side liquidity, the price has made a shift in market structure from bearish to bullish.
• For intraday trading, move to the lower time frames such as the 15-minute (M15) or 5-minute (M5) charts to find trading opportunities.

Explained Daily Bias Trading Strategy

To trade daily bias, start by analyzing from higher time frames and then move to lower time frames.

• If the price has taken internal liquidity, the next draw on liquidity (DOL) will be external range liquidity, or vice versa.
• Price moves for two main reasons: to target liquidity and to rebalance pricing gaps.
• Always seek trading opportunities that align with the larger time frame’s confluence.
• If, on the higher time frame, the price is moving from Internal Range Liquidity (IRL) to External Range Liquidity (ERL), then switch to lower time frames during ICT Kill Zones. Wait for a liquidity sweep in the opposite direction of the external range liquidity.
• Observe the market structure and open your trade when the price returns to refill the price imbalance.

Bearish Example

EURUSD Daily Bias Bullish Example

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