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September 3, 2023

Optimal Trade Entry Model

Master the art of OTE by ICT with a step-by-step guide going over how to add OTE to your trading arsenal.

Optimal Trade Entry Model

Trade with OTE

Timing is crucial in trading, and having a well-defined strategy can significantly increase your odds of success. The Optimal Trade Entry (OTE) strategy is one such approach described by ICT that traders can utilize to identify high-probability trade setups. In this article, we will walk you through the step-by-step process of implementing the OTE strategy, from timing to execution.

It is important to identify the specific time and day when OTE is most likely to occur. Typically, this occurs between 8:30 AM and 11:00 AM New York local time. Understanding the timing helps you align your trades for optimal results and capitalize on potential opportunities.

Next, look for a shift in market structure. This occurs when a short-term low or high is broken, followed by a rally in the opposite direction. This pattern indicates a potential OTE setup and can provide trading opportunities. Pay close attention to these shifts as they can provide valuable insights into the market’s bias for the day.

To effectively implement the OTE strategy, it is crucial to identify the dealing range during the OTE trade session. This range is defined through using the high and low points where both buyside and sellside liquidity has been run out during the OTE session. This range dictates our defined range for the day and is necessary to note in order to identify an OTE entry.

Once you have identified the dealing range, utilize the Fibonacci retracement tool to mark off the high and low. Focus on the 62% and 79% Fibonacci level range to identify the OTE zone. While Fibonacci alone is not the sole determining factor, it adds confluence as a graphical representation that can assist in validating potential entry points.

Now that you have identified the OTE zone, it's time to execute your trade with precision. Place your entry order within the OTE zone, ensuring that it aligns with your trading plan and risk management strategy. Utilize your own risk management strategy at this point to enter and manage any trades taken.

The Optimal Trade Entry (OTE) strategy offers traders a powerful tool to identify high-probability trade setups. This is one of many concepts taught by ICT to attack the market at its most predictable moments. However, it is important to remember that consistent profitability requires practice, discipline, and ongoing market analysis. The OTE strategy will serve as a powerful asset in your trading journey.

Dylan Worrall
Dylan Worrall

Nice to meet you! I am the Founder and CEO of Traddoo. I hope you enjoy reading a bit more about our business

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