ICT Power of 3 (AMD): Accumulation, Manipulation, Distribution Explained

Every daily candle tells a story. Not the open-high-low-close data point that most traders see, but the sequence of events that built that candle throughout the day. The Power of 3 (PO3) framework, also called AMD (Accumulation, Manipulation, Distribution), explains this sequence.

Once you understand how institutions structure price delivery within a session, you stop reacting to moves and start anticipating them.

What Is the Power of 3?

The Power of 3 describes how institutional price delivery unfolds in three phases:

1. Accumulation - Institutions quietly build positions during a low-volatility period
2. Manipulation - Price is pushed against the intended direction to trigger stops and generate liquidity
3. Distribution - The real move occurs as institutions distribute their positions in their intended direction

This sequence repeats on every timeframe - within a daily candle, a session, a weekly candle, and even on lower timeframes. The scale changes but the structure doesn't.

Phase 1: Accumulation

What Happens

The accumulation phase is a period of consolidation and range-building. Price moves sideways in a tight range with small candles and low volatility. Nothing looks interesting. Most retail traders ignore it or get chopped up trying to trade the range.

Behind the scenes, institutions are quietly building their positions. They can't execute their full order at once - the size would move the market against them. So they accumulate over time, buying or selling in small increments within the range.

Where It Occurs

• Daily candle: The Asian session (roughly 8 PM - 2 AM EST) typically forms the accumulation range
• Weekly candle: Monday often serves as the accumulation day
• Intraday: The first 30-60 minutes of a session can form micro-accumulation before the session's main move

What to Watch For

• Tight consolidation range forming
• Low volume relative to previous periods
• Price oscillating between defined highs and lows
• No clear directional momentum
• The range's high and low become liquidity targets for the next phase

The accumulation range is not the trade. It's the setup for the trade. Mark the range high and low - they become critical reference points.

Phase 2: Manipulation

What Happens

This is where most retail traders get trapped. Price breaks out of the accumulation range in the wrong direction - against where institutions actually want price to go. This false breakout serves two purposes:

1. Triggers stop losses - Traders who positioned correctly during accumulation get stopped out
2. Creates liquidity - The stop triggers and breakout entries provide the liquidity institutions need to fill their large orders at favorable prices

The manipulation phase is a liquidity sweep. It's engineered. Price pushes past the accumulation range to trigger the orders resting there, absorbs that liquidity, and then reverses.

Where It Occurs

• Daily candle: London Open often sweeps one side of the Asian range before reversing
• Weekly candle: Early in the week, price sweeps the previous week's high or low
• Intraday: The first move out of a consolidation is frequently the fake move

What to Watch For

• A sharp move beyond the accumulation range high or low
• The move sweeps liquidity - taking out obvious stop-loss levels
• Volume spikes on the sweep as stops trigger
• The move lacks follow-through - price stalls quickly after breaking the range
• Wicks begin forming, suggesting rejection of the new level

How to Avoid Getting Trapped

The manipulation phase is specifically designed to get retail traders on the wrong side. Common traps:

• Breakout traders enter on the range break, placing stops inside the range - exactly where price is headed
• Mean reversion traders fade the range, get stopped when price briefly expands beyond their levels
• Impatient traders enter during accumulation, get stopped during manipulation

The solution: wait for the manipulation to complete before entering. Don't trade the breakout. Trade what comes after.

Phase 3: Distribution

What Happens

After accumulation (building positions) and manipulation (generating liquidity), institutions now distribute - they drive price aggressively in their intended direction. This is the real move.

Distribution is characterized by:

• Strong displacement candles with large bodies and small wicks
• Fair value gaps created by the aggressive momentum
• Clear breaks of structure confirming the directional move
• Volume expansion as the move accelerates
• Sustained directional movement, not just a spike

Where It Occurs

• Daily candle: New York session typically delivers the distribution move
• Weekly candle: Wednesday through Thursday often delivers the week's main move
• Intraday: The second major push after the manipulation reversal

This Is Where You Trade

The distribution phase is where your entry should be. Not during accumulation (too early, no direction). Not during manipulation (you'd be on the wrong side). During distribution, the direction is confirmed and momentum is with you.

The best entries during distribution:

• Retests of FVGs created by the initial displacement
• Order block retests at the origin of the move
• Lower timeframe pullbacks within the distribution trend
• Silver Bullet setups during the kill zone that delivers the distribution

PO3 on the Daily Candle

The most common application of PO3 maps directly to the trading sessions:

Phase	Session	Time (EST)	What Happens
Accumulation	Asian	8 PM - 2 AM	Range builds, positions accumulated
Manipulation	London Open	2 AM - 5 AM	Range swept, liquidity taken
Distribution	New York	7 AM - 2 PM	Real move delivered

Bullish PO3 Day

1. Asian session builds a range
2. London sweeps the Asian low (manipulation down)
3. Price reverses and the daily candle closes bullish
4. The open is near the low of the day; the close is near the high

The daily candle has a long lower wick (manipulation) and a large bullish body (distribution).

Bearish PO3 Day

1. Asian session builds a range
2. London sweeps the Asian high (manipulation up)
3. Price reverses and the daily candle closes bearish
4. The open is near the high of the day; the close is near the low

The daily candle has a long upper wick (manipulation) and a large bearish body (distribution).

PO3 on the Weekly Candle

The same structure plays out across the week:

Phase	Day	What Happens
Accumulation	Monday	Range-building, low-conviction trading
Manipulation	Tuesday (early)	Week's high or low is set (the fake move)
Distribution	Wednesday - Thursday	Week's main directional move
Consolidation	Friday	Profit-taking, reduced volume

This is why many ICT traders focus their entries on Tuesday afternoon through Wednesday - the manipulation is complete and distribution is beginning.

How to Trade PO3

Step 1: Identify the Accumulation Range

Before your target session begins, mark the range that has formed:

• For daily PO3: Mark the Asian session high and low
• For weekly PO3: Mark Monday's high and low
• For intraday PO3: Mark the pre-session consolidation range

Step 2: Determine Directional Bias

You need to know which side of the range will be swept (manipulation) and which direction the real move (distribution) will go. Determine bias from:

• Higher timeframe market structure - Is the daily/4H trend bullish or bearish?
• Premium/discount positioning - Is price in a discount (expect bullish distribution) or premium (expect bearish)?
• Previous session narrative - What did London establish? What is NY likely to continue?
• Key levels above and below - Where is the nearest draw on liquidity?

Step 3: Wait for Manipulation

Watch for price to sweep one side of the accumulation range. The sweep should:

• Push beyond the range high/low
• Trigger visible stop losses
• Show signs of rejection (wicks, volume shift)
• Occur during the expected manipulation window (London for daily PO3, Tuesday for weekly)

Step 4: Enter During Distribution

Once manipulation is complete and price reverses:

• Look for an FVG on the reversal as the entry point
• Confirm with a lower timeframe change of character
• Enter with a stop below the manipulation low (bullish) or above the manipulation high (bearish)
• Target the opposite side of the accumulation range as the first take-profit, with extensions toward the next liquidity level

Example: Bullish Daily PO3

1. Mark the Asian session range: High at 1.0850, Low at 1.0820
2. Daily bias is bullish (4H structure making higher highs)
3. London opens and sweeps below 1.0820 to 1.0810 (manipulation)
4. Price rejects and a bullish FVG forms on the 5-minute chart
5. Enter long on the FVG retest, stop below 1.0810
6. TP1 at 1.0850 (opposite range extreme), TP2 at previous day's high

When PO3 Fails

The framework is a tendency, not a guarantee. It fails when:

No manipulation occurs - Sometimes London simply continues in the distribution direction without sweeping the range. No sweep means no PO3 setup. Don't force it.

Manipulation in both directions - High-impact news or conflicting institutional flows can sweep both sides of the range. When the range is swept in both directions, the setup is invalidated.

Distribution doesn't follow - The manipulation occurs but price doesn't reverse convincingly. It chops or slowly drifts back. If distribution doesn't begin within a reasonable time, the thesis is weakening.

Higher timeframe event overrides - A weekly PO3 cycle can override the daily PO3 pattern. If Tuesday's daily distribution is against the weekly distribution direction, the weekly structure usually wins.

Common Mistakes

1. Trading during accumulation - The range exists for institutions to build positions, not for you to scalp. Trading the chop leads to frustration and small losses that compound.

2. Trading the manipulation as a breakout - The most expensive mistake. The manipulation is designed to trap breakout traders. Wait for the reversal.

3. Entering distribution too late - If the distribution move is already extended and approaching the next major level, the risk-reward is no longer favorable. Better to wait for a pullback or skip the setup.

4. Applying PO3 without higher timeframe context - PO3 describes how price is delivered, but it doesn't tell you the direction. Without top-down analysis, you're guessing which side is manipulation and which is distribution.

5. Expecting exact session timing - PO3 phases don't start and stop at exact times. London might begin manipulating at 1 AM or 4 AM. The framework is a guide for the sequence of events, not a clock.

Key Takeaways

• Power of 3 describes three phases: Accumulation (range building), Manipulation (false move/liquidity sweep), Distribution (real move)
• The pattern repeats on every timeframe - daily candles, weekly candles, and intraday sessions
• On a daily candle, Asian = accumulation, London = manipulation, New York = distribution
• On a weekly candle, Monday = accumulation, Tuesday = manipulation, Wednesday-Thursday = distribution
• The manipulation phase is designed to trap retail traders - don't trade the initial range breakout
• Enter during the distribution phase, after manipulation is complete and direction is confirmed
• Higher timeframe bias is required to know which direction the distribution will go
• PO3 is a tendency, not a rule - when the pattern doesn't materialize, step aside