Level 3 · Lesson 12
SMC Trade
Models
Two complete trade models that chain every SMC concept into executable, repeatable strategies. This is where knowledge becomes money.
First — Why This Matters
🛠 You've learned 11 tools. Now let's build two machines.
Knowing what a hammer, saw, and nail are is useless if you can't build a house. You now know liquidity, order blocks, FVGs, OTE, breakers, kill zones, and PO3. Each is a powerful tool. But tools don't make money — strategies do.
This lesson gives you two complete, battle-tested trade models that chain every SMC concept into a step-by-step execution plan. Model 1 catches reversals. Model 2 catches continuations. Together, they cover 90% of all high-probability SMC setups.
After this lesson, you won't wonder "what do I do now?" when you open a chart. You'll know exactly which model applies, where to enter, where to put your stop, and where to take profit.
01 — Model 1: The Reversal
Liquidity Sweep → MSS → OB Entry
The most powerful reversal model in SMC. It catches the turn after institutional manipulation. This is the "heist" from Lesson 3.11 turned into a step-by-step trade plan.
02 — Model 2: The Continuation
HTF OB → LTF BOS → OTE Entry
The trend-following model. It enters with-trend pullbacks at institutional levels with precision timing. This is how you ride the big moves.
03 — Model Comparison
Model 1 vs Model 2 — When to Use Which
04 — Real Trade Walkthroughs
Two Complete Trades — Step by Step
Let's walk through one trade for each model exactly as it would happen in real time.
Model 1 Walkthrough — EUR/USD London Open
06:50 UTC: Asian range marked: 1.0880 (high) – 1.0862 (low). Equal lows visible at 1.0862. HTF Daily bias: bullish (HH/HL structure). SSL sitting below 1.0860.
07:08 UTC: London opens. Price spikes to 1.0855 — sweeping the Asian low and SSL by 7 pips. Long wick forms on the 15M.
07:25 UTC: 15M prints a bullish engulfing. BOS confirms above 1.0868. MSS confirmed.
07:40 UTC: Price pulls back to 1.0865 — the OB formed during the sweep. This OB sits at the 70.5% OTE level. Entry: 1.0865.
Stop: Below sweep wick at 1.0852. Risk: 13 pips.
Target: BSL above Asian high at 1.0885, then 1.0900 (next HTF liquidity). Reward: 20–35 pips. R:R: 1:1.5 to 1:2.7.
14:30 UTC: Price reaches 1.0903 during the overlap. Close full position. +38 pips. 1:2.9 R:R.
Model 2 Walkthrough — XAU/USD Swing Entry
Daily chart: Gold in uptrend (HH/HL). Last impulse: $2,310 → $2,365. OB at $2,328–$2,335 sits at the 67% Fib level (deep inside OTE). FVG overlaps at $2,330–$2,338. A+ grade.
Day 1: Price retracing from $2,365. Watching for price to reach the $2,328–$2,335 OB zone.
Day 2, 08:15 UTC: Price touches $2,332 — inside the OB + OTE + FVG confluence. Drop to 1H chart.
Day 2, 09:00 UTC: 1H prints bullish engulfing at $2,331. BOS confirms above $2,340 on the next candle.
Entry: $2,338 (pullback after BOS). Stop: Below OB at $2,325. Risk: $13.
Target: Previous swing high at $2,365, then $2,380 (1.618 extension). Reward: $27–$42.
Day 4: Price reaches $2,378. Close at $2,375. +$37. R:R: 1:2.8.
05 — Pre-Trade Checklist
Before Every Trade — 6 Checks
Run this checklist before entering ANY trade. If any check fails, do not enter.
Kill Zone Active?
Am I trading during a Kill Zone window? (Lesson 3.10)
HTF Bias Clear?
Does the Daily/4H show a clear trend or is price at a key level?
Model Identified?
Is this a Model 1 (sweep + reversal) or Model 2 (trend + pullback)?
Confirmation Received?
Has a BOS, CHoCH, or engulfing confirmed the setup on the LTF?
Risk Calculated?
Is my stop loss defined, position size correct, and R:R at least 1:2? (Lesson 1.5 + 1.6)
Emotional Check
Am I calm and objective? Or am I chasing, revenge trading, or bored?
06 — Risk Rules for Models
Non-Negotiable Risk Rules
1% Maximum Per Trade
Never risk more than 1% of your account on a single trade. Even A+ setups can fail. (Lesson 1.5: Risk)
Minimum 1:2 R:R
If the reward isn't at least 2x the risk, skip the trade. Model 1 should offer 1:3+. Model 2 should offer 1:2.5+.
Maximum 2 Trades Per Session
If two setups fail in the same session, stop. Do not revenge trade. The next Kill Zone will provide fresh opportunities.
Trail to Breakeven at 1R
Once the trade reaches 1R of profit, move your stop to breakeven. This makes the trade risk-free. Let the rest run.
07 — Common Mistakes
Model Execution Mistakes
08 — Pick the Model
Model Selection Game
5 scenarios. Identify which model applies and what to do.
Bullish Sweep Setup
Price ranged, swept below, reversed with a BOS, and now pulled back to an OB. Which model is this?
09 — Knowledge Check
SMC Trade Models Quiz
1. What is the core sequence of Model 1 (Liquidity Sweep Model)?
2. What is the core sequence of Model 2 (OTE Continuation Model)?
3. When should you use Model 1 vs Model 2?
4. In Model 1, where does your stop loss go?
5. In Model 2, what role does the LTF play?
6. What is the target for a Model 1 bullish trade?
7. What should you do if neither model presents a clear setup?
8. Which SMC concepts from earlier lessons are combined in these models?
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