OTE

What it measures

The OTE (Optimal Trade Entry) is ICT’s entry on the pullback of an impulse. The indicator looks for a leg: an impulse that breaks structure (an MSS if it changes the previous trend, a BOS if it continues it), from the low it starts at to the first high that gets confirmed. That’s the bullish one; the bearish one is the same, reversed.

On that leg it marks the OTE zone, the 62 to 79 % retracement with 70.5 % as the ideal point, and places a limit order. If price comes back and touches it, the trade enters with the stop at the start of the leg and the target beyond its extreme.

It’s a Pro plan indicator. It marks what has happened; it isn’t a recommendation or a buy or sell signal.

How it’s calculated

• The leg: the impulse that breaks structure, from the extreme it starts at to the first high (low, in the bearish one) that gets confirmed on the breaking candle or after it. A high is confirmed by a lower candle on each side (“Candles on each side of a high or low”). The leg is known once that high is confirmed, and it’s not valid if price went past its start in between. It has to measure at least 20 ticks (“Minimum leg”).
• Time frame: the leg is calculated on “1 hour” candles that the indicator builds from the chart’s, on any chart (“Time frame of the pattern”). The order is simulated with the chart’s candles.
• Entry: a limit order at 62 % of the retracement, the edge of the zone price comes back through. With “Entry” it can go at 70.5 % (“At the midpoint (CE)”) or at 79 % (“At the other edge of the zone”).
• Stop: exactly at the start of the leg, the 100 %, with 0 ticks beyond (“Stop ticks beyond its level”).
• Target: the −27 % extension of the leg, beyond its extreme. “OTE target” also offers “The extreme of the leg (0 %)”, “Extension −62 %”, “Extension −100 % (symmetrical swing)” or “Like the others (liquidity or fixed R)”, which uses the “Target” from Entry and exit.
• The order waits 24 1-hour candles, one day. If that time passes without price getting there, it expires; if price reaches the target before the entry, it’s cancelled. With a risk under 4 ticks (“Minimum risk”) it isn’t traded.
• Hours: by default it has no windows, so it trades at any hour. With “Only inside the windows”, in When, it uses three New York windows: 8:30 to 11:00 and 2:00 to 5:00 on, and 13:30 to 16:00 off. The hour of the candle where the order is placed is the one that counts.
• One trade at a time: while there’s an order placed or an open trade, the other setups are discarded. And by default at most one trade enters per day (“Trades per window”: 1, from 1 to 5).
• If the target and the stop are both reached within one candle, there’s no way to know which came first: by default the order that platforms assume is used; it can also count as a loss or not count (“If the order within a candle is unknown”).
• High probability (off by default): it requires the drop to the start of the leg to have swept reference liquidity on the opposite side: the previous day’s and week’s high or low, those of the sessions (Asia, London, New York), the equal ones and the 15-minute ones.

How to read it

• A line joins the start of the leg to its extreme. From the extreme come the lines at 0, 50, 62, 70.5, 79 and 100 %, dashed and in violet, and the OTE zone (62 to 79 %) is filled: ice on the bullish one, pink on the bearish one.
• The entry line, in violet and thicker, marks where the order is. Until it has entered, the stop and the target show dashed; on entry the target box and the stop box appear.
• A text next to the zone says OTE, the direction (bullish or bearish), whether it’s MSS or BOS and how the order stands: placed, in progress, with its result in R, not filled or ran off without entering.
• A results panel in a corner summarizes the trades of the loaded period and says which entry and which target are in use.
• With “Show the ones not traded” the discarded setups also show, fainter.

Which chart to put it on

The leg is calculated on 1-hour candles and the OTE zone comes out the same on any chart of 1 hour or less. What changes is the order, which is simulated with the chart’s candles: on a 1 to 5 minute chart you see in which minute of each hour the entry, the target or the stop is hit. On a 1-hour chart, when one candle contains both the target and the stop, the rule above applies. The last 10 days are analyzed (“Days back”).

Built-in strategies

What the indicator already has inside and can mark for you on the chart. They show what has happened; they are not recommendations.

Adding it to the chart

In the chart bar, Indicators ▾ › More Indicators…. You’ll find it in the ICT category. It’s a Pro plan indicator. How to add and adjust an indicator is in Indicators.

Settings

Open them with the ⚙ on its row in Indicators ▾. All times are New York time.