Power of 3 (AMD) — Complete Guide

What is Power of 3?

Power of 3 (PO3) is one of ICT's most important concepts. It describes the three-phase cycle that institutions use to move price:

1. Accumulation — Institutions quietly build positions in a range
2. Manipulation — A false move traps retail traders (Judas Swing)
3. Distribution — The real move delivers price to the target

Every significant price move follows this 3-phase pattern, whether on a daily candle, a trading session, or a weekly swing.

The Three Phases Explained

Phase 1: Accumulation

• Price consolidates in a tight range
• Low volatility, choppy price action
• Institutions are building their positions
• Typically occurs during Asian session (for daily PO3)
• What to do: Identify the range, mark the highs and lows

Phase 2: Manipulation (Judas Swing)

• Price breaks out of the range in the WRONG direction
• This false breakout sweeps liquidity (stop hunts)
• Retail traders enter in the wrong direction
• Their stops become fuel for the real move
• What to do: DON'T trade the initial breakout — wait!

Phase 3: Distribution

• Price reverses and moves aggressively in the TRUE direction
• This is the institutional move — the real delivery
• Price targets the opposing liquidity pool
• Maximum displacement and momentum
• What to do: Enter during distribution, ride the move

    Daily PO3 Example (Bullish Day):

    Asian Session     London/NY Session
    (Accumulation)    (Manipulation → Distribution)

    ══════════╮
              │ ↓ False drop (Manipulation)
              ╰───╮
                  │
                  ╰───→ ↑↑↑ True move UP (Distribution)
                        ↑↑↑
                        ↑↑↑↑↑ → Targets BSL

PO3 on the Daily Candle

The daily candle perfectly illustrates PO3:

Bullish Day:

1. Open = Start of accumulation
2. Price drops first (manipulation — takes the daily low)
3. Price reverses and rallies (distribution)
4. Close = Near the high

Bearish Day:

1. Open = Start of accumulation
2. Price rises first (manipulation — takes the daily high)
3. Price reverses and drops (distribution)
4. Close = Near the low

PO3 on Sessions (Bangladesh Time)

Bullish PO3 Daily Template:

Bearish PO3 Daily Template:

How to Trade PO3

Step 1: Establish Daily Bias

Before the day begins, determine if it's a bullish or bearish day using:

• Higher timeframe structure (Daily/Weekly trend)
• Previous day's close and structure
• Key levels and liquidity targets
• Economic calendar events

Step 2: Mark the Asian Range

During the Asian session (12:00 AM - 9:00 AM BD time):

• Mark the Asian session high and low
• This range = Accumulation phase
• Both sides of this range have liquidity

Step 3: Identify the Manipulation

During London or early NY:

• Wait for price to break ONE side of the Asian range
• If your bias is bullish → expect price to break the Asian LOW first (manipulation)
• If your bias is bearish → expect price to break the Asian HIGH first

Step 4: Enter During Distribution

After the manipulation completes:

• Look for MSS/CHOCH confirming the reversal from manipulation
• Enter at the OB or FVG created during the reversal
• Target the opposing side of the range and beyond

Real Trading Examples

Example 1: EUR/USD Bullish PO3

1. Daily bias: Bullish (Daily in uptrend, price at discount)
2. Asian range (12AM-9AM BD): 1.0850 - 1.0870
3. Manipulation: London opens, pushes below 1.0850 to 1.0838 (sweeps Asian low SSL)
4. MSS: 15M bullish CHOCH after the sweep
5. Entry: 1.0845 at bullish OB after MSS
6. Stop: 1.0830 (below the manipulation low)
7. Distribution: Price rallies through Asian high to 1.0920
8. Result: +75 pips, 5R trade

Example 2: Gold Bearish PO3

1. Daily bias: Bearish (4H bearish MSS, weekly at premium)
2. Asian range: $2,395 - $2,410
3. Manipulation: London pushes above $2,410 to $2,418 (sweeps Asian high BSL)
4. MSS: 15M bearish CHOCH
5. Entry: $2,412 (bearish OB)
6. Stop: $2,422 | Target: $2,370
7. Result: +42 points, 4.2R

Example 3: NAS100 PO3 (Full Session)

1. Bias: Bullish (HTF discount, daily bullish order flow)
2. Asian range (12AM-9AM BD): 18,200 - 18,280
3. London manipulation: Drops to 18,170 (below Asian low)
4. NY distribution: Rallies from OB at 18,180 to 18,450
5. Entry: 18,190 | Stop: 18,160 | Target: 18,400
6. Result: +210 points, 7R

Common Mistakes

PO3 on Higher Timeframes

PO3 also applies to weekly and monthly candles:

Weekly PO3:

• Monday/Tuesday: Accumulation (range)
• Wednesday: Manipulation (mid-week reversal)
• Thursday/Friday: Distribution (true weekly move)

Monthly PO3:

• Week 1: Accumulation
• Week 2: Manipulation (false direction)
• Weeks 3-4: Distribution (true monthly delivery)

FAQ

How do I know which direction the manipulation will go?

Determine your daily bias first. If bullish, the manipulation goes DOWN (sells first). If bearish, manipulation goes UP (buys first). HTF analysis is key.

Does PO3 work every day?

Not perfectly every day, but the concept applies to most trending days. Range/consolidation days may not show clear PO3 structure.

Can I use PO3 on 1-minute charts?

PO3 works on all timeframes but is most reliable on 15M+ charts where institutional footprints are clearer.

Summary

Related Topics

• AMD — Same concept, different name
• Judas Swing — The manipulation phase
• Kill Zones — When to trade PO3
• Daily Bias — How to determine direction
• Silver Bullet — Entry model within PO3