ICT Market Maker Model: How Institutions Engineer Price Delivery

Most ICT concepts explain individual pieces of the puzzle - fair value gaps, order blocks, breaks of structure. The Market Maker Model puts all those pieces together into a complete narrative of how price moves from one liquidity pool to another.

It answers the question every trader asks: Why did price do that? Not after the fact, but in real time - by understanding the sequence institutions follow to engineer and deliver price.

What Is the Market Maker Model?

The Market Maker Model (MMM) describes the full lifecycle of an institutional price delivery from start to finish. It explains how market makers (large institutions, banks, algorithms) move price through five distinct stages to:

1. Accumulate positions at favorable prices
2. Generate the liquidity needed to fill their orders
3. Deliver price to their target level
4. Distribute positions at profitable prices

There are two variations:

• Market Maker Buy Model (MMBM) - The bullish version. Institutions want to buy, so they engineer price lower first to accumulate at a discount before delivering price higher.
• Market Maker Sell Model (MMSM) - The bearish version. Institutions want to sell, so they engineer price higher first to distribute at a premium before delivering price lower.

The models are mirror images. Once you understand one, you understand both.

The Five Stages

Stage 1: Original Consolidation

What happens: Price ranges in a tight consolidation. Volume is low, volatility is compressed, and the market appears to be going nowhere. This is the accumulation phase - institutions are quietly building their initial positions within the range.

What it looks like:

• Tight price range with defined highs and lows
• Small-bodied candles, often with overlapping wicks
• Low volume relative to recent history
• Retail traders get bored or chopped up trading the range

What to do: Mark the consolidation range. The high and low of this range become the first liquidity targets. Don't trade inside this range - wait for the model to develop.

Stage 2: Smart Money Reversal (Manipulation)

What happens: Price breaks out of the consolidation in the opposite direction of the intended move. This is the manipulation - the engineered move that generates the liquidity institutions need.

In the MMBM (bullish model):

• Price breaks below the consolidation range
• This triggers sell stops from traders who were long within the range
• It also lures breakout sellers who see a "bearish breakout"
• Institutions absorb all this sell-side liquidity to fill their buy orders at discount prices

In the MMSM (bearish model):

• Price breaks above the consolidation range
• This triggers buy stops from shorts and attracts breakout buyers
• Institutions absorb the buy-side liquidity to fill their sell orders at premium prices

What it looks like:

• A sharp move beyond the consolidation high/low
• Liquidity sweep of obvious stops
• Often occurs during a kill zone (London open is common)
• The move may look convincing - that's the point

What to do: Recognize this as the manipulation, not a genuine breakout. Do not trade it. Watch for signs that the sweep is complete - rejection wicks, volume shift, or a quick reversal back into the range.

Stage 3: Smart Money Accumulation/Distribution

What happens: After the manipulation sweep, price reverses and begins the re-accumulation (MMBM) or distribution (MMSM) phase. Institutions have filled their orders during the liquidity sweep and are now positioning for the main move.

What it looks like:

• Price reverses from the manipulation extreme
• A change of character occurs - the first structural break against the manipulation direction
• Fair value gaps form on the reversal, indicating displacement
• An order block forms at the reversal point - this is the institutional entry zone

What to do: This is where you start looking for entries. The CHoCH confirms the manipulation is over. The FVGs and order blocks provide specific entry zones.

Stage 4: Re-Distribution/Re-Accumulation (The Trend)

What happens: Price moves aggressively in the intended direction. This is the delivery phase - the main trend where institutions are actively driving price toward their target.

What it looks like:

• Strong displacement candles creating multiple FVGs
• Clear market structure - higher highs and higher lows (MMBM) or lower lows and lower highs (MMSM)
• Breaks of structure confirming the trend at each structural level
• Pullbacks are shallow and find support/resistance at FVGs and order blocks from earlier stages

What to do: Trade with the trend. Enter on pullbacks to FVGs and order blocks. Add to your position at structural retests. Trail your stop loss behind each new structural swing point.

During this phase, price may pause and form mini-consolidations before continuing. These are continuation patterns within the larger model - not new Stage 1 consolidations. The difference is context: they occur within an established trend, not at the beginning of one.

Stage 5: Reversal/Completion

What happens: Price reaches the target - the opposing liquidity pool. The model completes as institutions take profit and the move exhausts itself.

In the MMBM:

• Price reaches the buy-side liquidity target (previous highs, equal highs, a major resistance level)
• The target was predetermined by the nearest significant pool of buy-side liquidity
• Institutions begin distributing their long positions into the buy orders at the high

In the MMSM:

• Price reaches the sell-side liquidity target (previous lows, equal lows, major support level)
• Institutions begin covering their short positions into the sell orders at the low

What it looks like:

• Price reaches a significant structural level
• Momentum decreases (smaller candles, more wicks)
• A potential CHoCH against the trend forms
• A new consolidation may begin - potentially the Stage 1 of the next Market Maker Model

What to do: Take profit or tighten stops significantly. The model is completing. A new model may begin in either direction.

Market Maker Buy Model (MMBM) Summary

Stage	Name	Price Action	Institutional Activity
1	Original Consolidation	Tight range, low volatility	Quietly accumulating initial positions
2	Smart Money Reversal	Breaks below range (sweep)	Absorbing sell-side liquidity to fill buys
3	Accumulation	CHoCH, FVGs form on reversal	Positioning for the upside delivery
4	Re-Accumulation	Strong uptrend with pullbacks	Delivering price toward buy-side liquidity
5	Completion	Reaches target, momentum fades	Distributing longs into buy-side liquidity

Market Maker Sell Model (MMSM) Summary

Stage	Name	Price Action	Institutional Activity
1	Original Consolidation	Tight range, low volatility	Quietly distributing initial positions
2	Smart Money Reversal	Breaks above range (sweep)	Absorbing buy-side liquidity to fill sells
3	Distribution	CHoCH, FVGs form on reversal	Positioning for the downside delivery
4	Re-Distribution	Strong downtrend with pullbacks	Delivering price toward sell-side liquidity
5	Completion	Reaches target, momentum fades	Covering shorts into sell-side liquidity

How to Trade the Market Maker Model

Entry Zone: Stage 3

The best entry point is during Stage 3 - after the manipulation is complete and the reversal begins:

1. Wait for the Stage 2 manipulation sweep to complete
2. Identify the CHoCH that confirms the reversal
3. Mark the FVG and/or order block formed during the reversal
4. Enter when price retests the FVG or order block
5. Stop loss below the Stage 2 manipulation low (MMBM) or above the manipulation high (MMSM)
6. Target the opposing liquidity pool (the Stage 5 completion level)

This gives you the full Stage 4 trend as your profit potential, with a tight stop at the manipulation extreme.

Adding Positions: Stage 4

During the trending phase, you can add to your position at structural pullbacks:

• FVGs created during the Stage 4 displacement
• Order blocks at each new structural level
• Each new break of structure confirms the model is still active

Use the position size calculator to keep each addition within your risk parameters.

Exit: Stage 5

Take profit when price approaches the identified liquidity target. Signs the model is completing:

• Price reaches the target level (previous highs/lows, equal highs/lows)
• Momentum slows visibly (candle bodies shrink, wicks increase)
• A lower timeframe CHoCH against your trade direction appears
• The next kill zone shows no continuation

Identifying the Liquidity Target

The target of the Market Maker Model is always the nearest significant liquidity pool in the direction of the intended move.

For a MMBM (bullish), the target is buy-side liquidity:

• Previous swing highs
• Equal highs (obvious double tops)
• Previous session highs (London high, Asian high)
• Previous day/week high

For a MMSM (bearish), the target is sell-side liquidity:

• Previous swing lows
• Equal lows (obvious double bottoms)
• Previous session lows
• Previous day/week low

The liquidity pool is determined before the move begins by analyzing the chart for obvious levels where stops are resting. This is what gives the model its predictive power - you know the destination before the journey starts.

MMM on Different Timeframes

The Market Maker Model is fractal - it appears on every timeframe:

Weekly/Daily: The macro model. Stage 1 might last days, the manipulation targets weekly highs/lows, and Stage 4 delivers over multiple days. Best for swing traders.

4H/1H: The session model. The model often completes within a single trading day. Stage 1 during Asian session, Stage 2 during London, Stages 3-4 during New York. This is the most commonly traded MMM timeframe.

15m/5m: Micro models within larger models. Useful for timing entries within a Stage 3 or adding to positions during Stage 4 pullbacks. Higher noise, requires the context of a larger timeframe model.

The most effective approach: identify the model on the 4H or 1H, then use 15m or 5m for entry timing within Stage 3.

MMM vs Power of 3

The Market Maker Model and Power of 3 (AMD) describe similar institutional behavior but at different levels of detail:

Aspect	Power of 3	Market Maker Model
Phases	3 (AMD)	5 stages
Detail level	Framework/concept	Specific trade model
Target identification	General direction	Specific liquidity pool
Entry precision	Direction only	Exact stage and level
Best use	Understanding daily narrative	Planning specific trades

Think of PO3 as the philosophy and MMM as the trading plan. PO3 tells you to expect accumulation → manipulation → distribution. MMM tells you exactly what each stage looks like, where to enter, and what the target is.

Common Mistakes

1. Labeling Every Consolidation as Stage 1

Not every range is the beginning of a Market Maker Model. The consolidation must occur at a level where institutional positioning makes sense - near a major structural level or at the edge of a premium/discount zone. A range in the middle of nowhere with no structural significance isn't Stage 1.

2. Entering During Stage 2

The manipulation is designed to look convincing. Traders who enter during Stage 2 - shorting the breakdown in a MMBM or buying the breakout in a MMSM - are providing the liquidity institutions need. Wait for Stage 3 confirmation.

3. Not Having a Clear Target

The model only works if you can identify the liquidity target before entering. If there's no obvious pool of buy-side or sell-side liquidity for price to target, the model may not apply, or your target may be too close for a worthwhile trade.

4. Forcing the Model Onto Every Move

Not every price move follows the Market Maker Model. Sometimes markets trend without a clean Stage 2 manipulation. Sometimes the manipulation doesn't reverse. Apply the model when the stages unfold clearly, and sit out when they don't.

5. Ignoring Higher Timeframe Context

A 15-minute MMBM during a Daily downtrend is fighting the dominant flow. The MMM on lower timeframes must align with the higher timeframe structure.

Market Maker Model Checklist

Factor	Check	Required?
Clear Stage 1 consolidation	Defined range at a structural level	Yes
Stage 2 manipulation sweep	Price breaks beyond the range	Yes
Liquidity taken on the sweep	Stops triggered, breakout traders trapped	Yes
Stage 3 CHoCH	Structure shifts against the manipulation	Yes
FVG/OB formed at reversal	Entry zone identified	Yes
Clear liquidity target	Obvious pool in the delivery direction	Yes
HTF alignment	Model direction matches dominant trend	Preferred
Kill zone timing	Stage 2-3 occur during active session	Preferred
R:R ≥ 3:1	Stop at manipulation extreme, TP at target	Yes

The Short Version

• The Market Maker Model describes the full lifecycle of institutional price delivery in five stages
• MMBM (bullish): consolidation → sweep lows → accumulate → trend up → reach buy-side liquidity
• MMSM (bearish): consolidation → sweep highs → distribute → trend down → reach sell-side liquidity
• The best entry is during Stage 3, after manipulation completes and the CHoCH confirms
• The target is always the nearest significant liquidity pool in the delivery direction
• The model is fractal and appears on all timeframes - use higher timeframes for the model and lower timeframes for entry timing
• Stage 2 manipulation is designed to trap retail traders - never trade the initial range breakout
• Always identify the liquidity target before entering - no clear target means no trade
• The Market Maker Model is the complete narrative; individual concepts like FVGs, OBs, and BOS are the building blocks within it