# ICT Market Structure: Swing Points, BOS and MSS · DT Academy > ICT market structure: short, intermediate and long term swings, break of structure, the market structure shift with displacement, and CHoCH. [Back to ICT Concepts](https://www.thedtterminal.com/academy/courses/ict-concepts) Lesson 3Market structure the ICT way Chapters done # Market structure the ICT way Lesson 03 · 5 min read · By DT Terminal Mark swings by ICT's three-candle rule, grade them short, intermediate and long term, and tell a break of structure from a shift with displacement. Unlock the full lesson in the app Worked examples, the quiz and the interactive tools are in the app. Free account. [Continue in the app, free](https://www.thedtterminal.com/login?signup=true&redirect=%2Fjournal%2Facademy%2Fict-market-structure) Chapter 1 of 6 ## Swing points by rule [Day 10, Market structure](https://www.thedtterminal.com/academy/market-structure) marked swings by eye. ICT makes the call mechanical. A **short term high (STH)** is a candle whose high is above the highs of the candles on both sides. A **short term low (STL)** is the mirror. That is the three candle rule. New to candles? [Day 2](https://www.thedtterminal.com/academy/how-to-read-candlesticks) covers highs, lows and wicks. The rule needs the candle after the swing, so **the newest candle on your chart is never a swing yet**. **A rule, not a feel.** Two traders using the rule **mark the same swings**, which makes your structure notes testable. Chapter 2 of 6 ## Short, intermediate and long term ICT grades swings in three tiers, each built from the one below it. - An **intermediate term high (ITH)** is a short term high with a lower short term high on each side. - A **long term high (LTH)** is an intermediate term high with a lower ITH on each side. - Lows mirror this: STL, ITL and LTL. The tiers name the swing a move took out: "broke the ITH", not "broke a high". Worked example ### Example 01: Grading five highs The worked example, with every number walked through, is in the app. [Continue in the app, free](https://www.thedtterminal.com/login?signup=true&redirect=%2Fjournal%2Facademy%2Fict-market-structure%3Fsection%3Dthree-tiers%23three-tiers) Free account Chapter 3 of 6 ## Break of structure and market structure shift With the swings marked, two events matter. A **break of structure (BOS)** is a move beyond a swing point in the direction of the trend. In an uptrend, that is a close above the last high. It says **the trend is carrying on**. A **market structure shift (MSS)** is the first break against the trend. In an uptrend, that is a close below the last higher low, the low that launched the latest high. It is **the first sign the trend may be turning**, not proof that it has. | Event | In an uptrend | What it suggests | | --- | --- | --- | | BOS | A close above the last high | The trend continues | | MSS | A close below the last higher low, **with displacement** | The trend may be turning | Chapter 4 of 6 ## A shift needs displacement An MSS needs **displacement**: a strong, one way move, usually fast enough to leave a fair value gap, the three candle pattern from [Day 12](https://www.thedtterminal.com/academy/fair-value-gaps). **A slow grind through the level does not meet the rule**. Market structure shift ### With displacement, a slow break, and a wick - Bearish shift - Bullish shift - Fair value gap Bearish shift an uptrend closes below its last higher low Bullish shift a downtrend closes above its last lower high Shift with displacement a fast close through, leaving a gap Slow break closes through, but no gap Wick only it closes back: no break **Read down a column.** All three reach the gold level. Only the top row closes through it fast enough to leave a gap, so only the top row is an MSS by ICT's rule. Schematic candles, not market data. The bullish column is the bearish one turned upside down. Worked example ### Example 02: A shift with displacement The worked example, with every number walked through, is in the app. [Continue in the app, free](https://www.thedtterminal.com/login?signup=true&redirect=%2Fjournal%2Facademy%2Fict-market-structure%3Fsection%3Ddisplacement%23displacement) Free account Whether displacement makes a shift more reliable is a claim no published study tests. Backtest it. Chapter 5 of 6 ## CHoCH, and wick or close You will meet **CHoCH**, change of character. It is a Smart Money Concepts (SMC) community term, not core ICT vocabulary, for roughly the same thing as the MSS: the first break against the trend. The more common mistake is **counting a wick through a swing as a break**. Decide once whether a break needs a body close beyond the level or only a wick through it, and **keep that rule on every chart**. **Pick wick or close once.** A rule that changes from chart to chart **cannot be tested**. A rule that stays the same can. **Go deeper** Some SMC teachers split the two, using CHoCH for the first warning break and MSS for the version confirmed by displacement. Neither usage is official, so write down the one you use. Most ICT based models use a **body close plus displacement** for an MSS. Chapter 6 of 6 ## Write your structure rules down People mark swings differently, so **write your rules down before you trade them**: the swing rule, the tier you trade from, wick or close, and what counts as displacement. Mark structure candle by candle in the backtester Replay a week of `GBPUSD` on M15. As each candle prints, mark short term highs and lows, promote them when they qualify, and label every BOS and MSS by your rule. Write the shift as an entry criterion Add your MSS rule to a strategy's entry criteria as one checkable sentence, such as "An M15 body closes below the last higher low and the move leaves a fair value gap". Then link your trades to it. Quick review ## Check yourself Quick review · 0 of 0 Five questions, one for each idea in this lesson. [All lessons in ICT Concepts](https://www.thedtterminal.com/academy/courses/ict-concepts) [Previous](https://www.thedtterminal.com/academy/ict-sessions-and-killzones) ## The ICT clock: sessions and killzones Lesson 02 · 6 min read [Next in ICT Concepts](https://www.thedtterminal.com/academy/ict-liquidity) ## Liquidity the ICT way Lesson 04 · 6 min read ## Try it on your own account Connect a broker and DT Terminal verifies every trade against it. Free to start. [Start free](https://www.thedtterminal.com/login?signup=true&from=academy&entry=closing_card&redirect=%2Fjournal%2Facademy) [Back to DT Academy](https://www.thedtterminal.com/academy) DT Academy is education, not financial advice. Nothing here is a recommendation to buy or sell any instrument. Trading carries a high risk of losing money, and past results, examples and backtests do not guarantee future results. 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