SMC Entry Model Step by Step: The Complete Playbook for High-Probability Entries

Every profitable SMC trader follows some version of the same core entry model. The specifics vary -- timeframes, instruments, confirmation style -- but the skeleton is identical. Higher timeframe bias, point of interest, lower timeframe confirmation, entry at an imbalance, stop behind structure, target at liquidity.

This post walks through each step with specific rules for what qualifies as valid at every stage. No theory for theory's sake. By the end, you should be able to sit down at your charts and execute this model on your next session.

The Model at a Glance

Before we break each step apart, here is the full sequence:

1. HTF Bias -- Determine bullish or bearish direction on the higher timeframe
2. POI Identification -- Mark where price should retrace to (FVG, order block, OTE zone)
3. Wait for Price to Reach the POI -- Do nothing until price enters your zone
4. LTF Confirmation -- Drop to the lower timeframe and wait for a structural shift
5. Entry -- Enter at the FVG or order block created by the LTF shift
6. Stop Loss -- Place behind the invalidation point
7. Target -- Aim for the next liquidity pool

Each step filters out bad trades. By the time you reach your entry, you have multiple layers of confluence working in your favor. Skip a step, and the model breaks.

Step 1: Establish Higher Timeframe Bias

Everything starts here. If you get the direction wrong, nothing else matters. If you get the direction right, even a mediocre entry can still produce a winner.

Open your higher timeframe chart. For most intraday traders, this means the 1-hour or 4-hour. For swing traders, the daily or weekly.

You are answering one question: is the market bullish or bearish right now?

What Qualifies as a Valid Bias

Bullish bias -- Price is making higher highs and higher lows. You have a confirmed break of structure (BOS) to the upside, meaning price closed above a previous swing high.

Bearish bias -- Price is making lower highs and lower lows. You have a confirmed BOS to the downside, meaning price closed below a previous swing low.

Change of Character (ChoCh) -- If the market was bullish and then closes below its most recent protected low, that is a bearish ChoCh. This is the first signal of a potential reversal. If it was bearish and closes above its most recent protected high, that is a bullish ChoCh.

The critical distinction: candle closes, not wicks. A wick below a key low is not a ChoCh. A close below it is.

Identifying External Highs and Lows

Once you have your BOS or ChoCh, mark the external high and external low of the current structure. These define your range.

• The external high is the most recent significant swing high in the current move
• The external low is the most recent significant swing low that preceded the BOS

In a bearish scenario, the external high is where you expect price to retrace to before continuing lower. The external low is the target sellers are aiming for. Everything between those two points is internal structure -- noise you can mostly ignore until you zoom into lower timeframes.

Your bias is now locked. If you are bearish, you are only looking for shorts. If bullish, only longs. One direction. No exceptions.

Step 2: Identify Your Point of Interest

With direction established, your next job is to define where price needs to retrace before you start looking for entries. This is your Point of Interest (POI).

A good POI combines multiple elements. The more confluence at a single zone, the higher the probability.

The OTE Zone

Draw a Fibonacci retracement from the structural swing high to the structural swing low (or vice versa for bullish). The Optimal Trade Entry zone sits between the 62% and 79% retracement levels.

This is the zone where institutional rebalancing most commonly occurs during a pullback. It is not a standalone entry signal -- it is a region where you start hunting for other confirmation.

The 50% level is also critical. In a bearish scenario, everything below the 50% is discount -- you do not short in discount. In a bullish scenario, everything above the 50% is premium -- you do not buy in premium.

This single rule eliminates a massive number of bad trades. If you are bearish and price is still below the 50% retracement, you wait. Period.

Fair Value Gaps Within the OTE

Look for fair value gaps that sit inside or overlap with the OTE zone. A 1-hour FVG that lines up with the 62-79% retracement zone is a high-probability POI.

Don't stop at one timeframe. Check the 15-minute chart for additional FVGs in the same area. If you have a 1H FVG and a 15m FVG both sitting inside the OTE, that is a well-defined area of interest. The Smarter Money Suite can automatically detect and highlight these multi-timeframe FVGs, saving you the manual process.

Order Blocks

If there is an order block sitting within the OTE zone -- the last bearish candle before a bullish impulse (or vice versa) -- that adds another layer of confluence. The block represents the price level where institutions initially positioned.

The strongest setups stack all three: OTE zone + FVG + order block, all converging at roughly the same price level.

Mark Your Targets Early

While you are on the HTF, also identify your targets. Look for:

• Equal highs or equal lows -- These represent resting liquidity that the market is likely to target
• Unmitigated FVGs below (for shorts) or above (for longs) the current range
• Previous swing points that serve as obvious draw-on-liquidity levels

Mark two targets: T1 (the nearest liquidity pool) and T2 (the deeper target). You will use these for partial profit-taking later.

Step 3: Wait for Price to Reach the POI

This is the step that separates profitable traders from everyone else. It is also the step that most traders skip entirely.

Once your POI is marked, you do absolutely nothing until price reaches that zone. You do not "get in early." You do not enter on the displacement that created the ChoCh. You do not take a position because it "looks like it's going your way."

The displacement move -- the aggressive candle sequence that broke structure -- is not your entry. That move is proof that institutional money is positioned. But you were not positioned with them. You need price to return to the POI so you can enter where they entered.

Why Patience Matters Mechanically

After a large displacement, the market needs to rebalance. Those aggressive candles created imbalances -- FVGs and unmitigated order blocks -- that price tends to revisit. More often than not, price will pull back to rebalance these areas before continuing in the direction of the displacement.

If you short the break of structure itself, you are entering at the worst possible price. Your stop loss has to be enormous, your risk-reward is terrible, and the pullback will likely stop you out before the move continues.

The pullback is not a problem. It is your opportunity.

What If Price Never Reaches the POI?

It happens. Sometimes price displaces so hard that it never comes back to your zone. When this occurs, you simply do not trade. There is no entry. Move on.

Missing a trade is not a loss. Forcing an entry at a suboptimal level is how you take real losses. The model only works when every condition is met.

Step 4: Lower Timeframe Confirmation

Price has reached your POI. Now drop to your lower timeframe. For most traders using the 1H as their HTF, the 5-minute is the standard LTF for confirmation. Some use the 1-minute for even tighter entries.

You are looking for one thing: a structural shift on the LTF that aligns with your HTF bias.

What Qualifies as Valid LTF Confirmation

If you are looking for shorts (bearish HTF bias), price will have been trending up on the 5-minute as it retraced into your POI. You need to see that 5-minute uptrend break.

Specifically, you need a 5-minute Change of Character -- price closes below the most recent protected low on the 5-minute chart.

For longs, the opposite: the 5-minute has been trending down into your demand zone, and you need a 5-minute ChoCh to the upside -- a close above the most recent protected high.

ChoCh vs. ChoCh+

A standard ChoCh occurs when price simply breaks the last protected swing point. A ChoCh+ occurs when price first forms a lower high (in a bearish scenario) or higher low (in a bullish scenario) before the structural break. The ChoCh+ is stronger because it shows momentum is already fading before the break confirms.

If you see a lower high forming on the 5-minute within your POI zone, followed by the ChoCh -- that is a high-conviction setup.

The Subjectivity Zone

This is the most discretionary part of the model. After the LTF ChoCh, you have to decide: do you enter immediately, or do you wait for price to retrace into the FVG or order block left by the ChoCh candle?

The decision depends on what the chart shows you:

Enter at the ChoCh if: There are no significant FVGs or imbalances above (for shorts) or below (for longs) for price to retrace to. The path of least resistance is continuation.

Wait for a retrace if: The ChoCh candle created a clear FVG that price could revisit. This gives you a tighter stop and better risk-reward, but you risk the trade leaving without you.

Check the 15-minute chart for guidance. If there are unmitigated FVGs between the ChoCh and where price currently is, price is more likely to retrace to fill them. If the 15-minute is clean with no FVGs, a retrace is less likely.

Step 5: Place Your Entry

Your entry goes at the FVG or order block created by the LTF structural shift.

For a bearish entry: The 5-minute ChoCh creates a displacement candle. The FVG left by that candle (or the last bullish candle before the displacement) is your entry zone. Set a limit order at the top of the FVG for a sell.

For a bullish entry: The 5-minute ChoCh to the upside leaves an FVG below. Set a limit order at the bottom of the FVG for a buy.

Validating the Risk-Reward Before Entering

Before you submit the order, measure from your entry to your stop loss and from your entry to your first target. The absolute minimum risk-reward should be 3:1. Many traders require 5:1 or higher.

If the math does not work -- if your stop is too wide or your target is too close for a 3R setup -- you do not take the trade. The numbers have to make sense before you commit capital. The risk-reward ratio is not something you figure out after you are already in.

Tools like the MTF Confluence Key Levels indicator can help you quickly identify where the nearest structural levels sit across multiple timeframes, making it faster to assess whether the math works for a given setup.

Step 6: Set Your Stop Loss

The stop loss goes at the invalidation point -- the price level that, if reached, would mean your trade thesis is wrong.

This is not an arbitrary number of pips. It is not "20 pips because that is what I always use." It is the structural level that negates the setup.

For Bearish Entries

If you have a ChoCh+ (lower high formed before the structural break), your stop loss goes above that lower high. This is a tight stop because the lower high should hold if the bearish scenario is valid.

If you have a standard ChoCh without a lower high, your stop loss goes above the swing high that formed within your POI zone.

For Bullish Entries

Mirror image. Stop below the higher low if you have a ChoCh+, or below the swing low within the POI zone for a standard ChoCh.

The Logic

Your stop loss is not just a risk management tool. It is your exit signal. If price reaches your stop, the market is telling you that your analysis was incorrect -- the LTF shift was a fakeout, and the HTF move is not playing out as expected. You exit, reassess, and look for the next setup.

Never move your stop loss further away from your entry to "give the trade more room." If the invalidation point gets hit, the trade is dead.

Step 7: Target Liquidity

Your targets should already be marked from Step 2. Now it is about managing the trade.

First Target: Nearest Liquidity

The first target is the closest significant liquidity pool in the direction of your trade:

• For shorts: The most recent swing low, equal lows, or a previous demand zone that was broken
• For longs: The most recent swing high, equal highs, or a previous supply zone that was broken

At T1, take 50% of the position off. This locks in profit and reduces psychological pressure for the remainder of the trade.

Second Target: External Liquidity

The second target is deeper -- the external low (for shorts) or external high (for longs) that you identified on the HTF. This is where the real money is in the trade. Markets seek liquidity, and if your HTF bias is correct, there is a strong probability that price reaches for these levels.

After hitting T1, move your stop loss to breakeven on the remaining position. You are now in an effectively risk-free trade (excluding slippage or gap risk) that is playing for the larger move.

When Equal Highs/Lows Are the Target

Equal highs and equal lows are particularly strong targets because they represent resting liquidity. When price creates two or more highs at nearly the same level (equal highs), buy stops accumulate above them. When price creates two or more lows at nearly the same level (equal lows), sell stops accumulate below them. The market will almost always sweep this liquidity eventually. The Liquidity Heatmap indicator can visualize where historical trading activity concentrates at these levels, making target selection more precise.

Full Worked Example: Bearish Setup

To tie it all together, here is the complete model applied to a bearish scenario:

Step 1 -- HTF Bias: On the 1H, price has been in a sustained uptrend but just closed below its most recent protected low. This is a bearish Change of Character. You flip to bearish. Shorts only from here.

Step 2 -- POI: Draw Fibonacci from the swing high to the new swing low. The OTE zone (62-79%) sits at a specific price range. You find a 1H FVG within that zone and a 15m FVG slightly below it. You also spot an order block retest opportunity at the top of the OTE. Targets: T1 at the nearest equal lows, T2 at an unmitigated FVG well below current price.

Step 3 -- Wait: Price starts to retrace upward. You do nothing. It takes six hours. You still do nothing. Finally, price enters your OTE zone and taps the 1H FVG. Now you move to Step 4.

Step 4 -- LTF Confirmation: Drop to the 5m. Price has been in a clear uptrend on this timeframe (which makes sense -- it was retracing up into your zone). You now see a lower high form, followed by a candle close below the last protected low. That is a 5-minute bearish ChoCh+. The retracement is over.

Step 5 -- Entry: The ChoCh candle leaves an FVG on the 5m. You check the 15m for unmitigated FVGs above -- there are none. You enter short at the top of the 5m FVG.

Step 6 -- Stop Loss: Stop goes above the lower high that formed before the 5m ChoCh. The math gives you a 3.2:1 risk-reward to T1. Valid.

Step 7 -- Targets: T1 (nearest swing low) hits within an hour. You close 50% and move stop to breakeven. T2 (equal lows below) hits 24 hours later. Full position closed. Net result: roughly 4.5R on the average between T1 and T2.

Confluence Checklist

Before entering any trade, run through this checklist. Every box should be checked:

• HTF market structure bias is clear (BOS or ChoCh confirmed with a candle close)
• You are only trading in the direction of the HTF bias
• POI is in the correct premium/discount zone (selling in premium, buying in discount)
• At least one FVG or order block sits within the OTE zone
• Price has actually reached the POI (no early entries)
• LTF structural shift (ChoCh) confirms the move is reversing at your zone
• Entry is at the FVG or OB created by the LTF shift
• Stop loss is at a structural invalidation point (not arbitrary)
• Risk-reward is 3:1 minimum to the first target
• Targets are at clear liquidity pools

If any item is missing, the trade does not qualify. Wait for the next setup.

The Smarter Money Suite integrates BOS/ChoCh detection, FVG mapping, and order block identification into a single overlay, making it significantly faster to run through this checklist in real time.

Common Mistakes That Destroy the Model

Entering on the displacement. The ChoCh or BOS on the HTF is not the entry. It is the signal to start preparing. The entry comes later, after the retrace and LTF confirmation.

Ignoring premium/discount. If you are short and price is in discount, you have no business entering. The retracement is not deep enough. Wait for price to reach premium.

Forcing trades below 3R. If the stop is too wide or the target is too close, the trade does not meet the criteria. Taking a 1.5R trade because it "looks good" will destroy your edge over time.

No LTF confirmation. Placing a limit order at an FVG and walking away is not this model. You must see the structural shift on the LTF before committing. The shift is what tells you the retracement is complete.

Moving the stop. Once set, the stop stays. If it gets hit, the analysis was wrong. Accept it and look for the next opportunity. One loss at 1R is irrelevant when your winners are 3-5R.

Adapting the Model to Your Style

The timeframe pairing is flexible. The model works the same way regardless of which charts you use:

Style	HTF (Bias)	LTF (Entry)
Scalping	15m	1m
Intraday	1H	5m
Swing (short)	4H	15m
Swing (long)	Daily	1H

The multi-timeframe analysis principles remain constant. Higher timeframe sets the direction. Lower timeframe provides the trigger. The ratio between them should be roughly 4:1 to 12:1 for clean structure on both.

For scalpers using the 15m/1m combination, the Candle Trap Zone indicator is particularly useful for spotting the micro-structure traps that form at POIs on the 1-minute chart.

Session Timing Matters

Not all hours are equal. The model produces the best results when traded during active sessions:

• London session (2:00-5:00 AM ET) -- Best for initial moves and liquidity sweeps of the Asian session range
• New York session (7:00-10:00 AM ET) -- Best for continuation after London establishes direction
• London close (10:00 AM-12:00 PM ET) -- Often produces the daily high or low

The Asian session (8:00 PM-12:00 AM ET) typically builds the range that London and New York target. If your model requires a liquidity sweep as part of the setup, you want that sweep of the Asian range to happen during London or early New York.

The Session Fib Fan automatically maps session ranges and Fibonacci levels across Asia, London, and New York sessions, giving you immediate visibility into which session levels have been swept and which are still resting as targets.

Putting It Into Practice

Do not try to trade this model live immediately. Here is the progression:

Week 1-2: Go through historical charts and identify completed setups. Mark all seven steps after the fact. This builds pattern recognition without financial risk.

Week 3-4: Use bar replay on TradingView to simulate live conditions. Step through the candles and make decisions in real time without real money.

Week 5+: Take the model to a demo account or paper trading. Execute real entries, manage real stops, and record every trade in a trading journal.

After 30+ demo trades with a clear edge, you are ready for live execution.

The model is simple. The execution requires discipline. Every step exists for a reason -- to filter out low-probability setups and leave you with only the trades that have the highest chance of working. Follow the process, trust the edge, and the results will follow.