Power of three, AMD and the Judas swing
Lesson 10 · 5 min read · By DT Terminal
Read a day as accumulation, manipulation and distribution, and write the Judas swing as a rule you can apply while it happens.
Unlock the full lesson in the app
Worked examples, the quiz and the interactive tools are in the app. Free account.
One candle, three phases
Power of three (PO3) reads a daily candle, or a session or a weekly one, as three phases in a row:
- Accumulation: a quiet range near the open.
- Manipulation: a move against the day's eventual direction that takes liquidity.
- Distribution: the main move.
Traders shorten it to AMD. On a bullish day the low tends to form early and the close near the high; a bearish day is the mirror. The idea overlaps with Wyckoff's much older accumulation, distribution, spring and upthrust.
The reference: the midnight open
ICT treats the price at 00:00 New York as the day's "true" open. On a bullish PO3 day the manipulation leg trades below it and the distribution finishes above it. On a bearish day, the reverse.
It follows US daylight saving: 05:00 UTC in US winter, 04:00 UTC in US summer. Set your chart to New York time, or convert once per season. The windows around it come from The ICT clock: sessions and killzones.
The Judas swing
The Judas swing is the manipulation leg at a session open: a false move away from the midnight or session open that runs stops, then reverses. Traders mark the obvious levels it could reach for: the Asian range, or the quiet range after midnight.
It is a sweep in the sense of Liquidity the ICT way: a wick beyond a known low, then a close back. If price closes beyond and keeps going, it was a run, not a Judas swing.
ICT describes the move as deliberate. Nothing public shows who is behind it, so this lesson only uses what you can see: the level, the wick and the close.
Bullish and bearish AMD days
Here are three ways a day can open, bullish and bearish. Only the top row is power of three as written. The middle row is a perfectly normal day the model has nothing to say about, and the bottom row is the one that traps a buyer.
Power of three
AMD days, and the days that only look like them
- Quiet range (A)
- The open
Bullish day
low early, close near the high
Bearish day
high early, close near the low
Textbook AMD
quiet open, a false move, then the run
Trend from the open
no false move: the low is the open
The false move kept going
no close back over the open
That is the hindsight problem. Every finished daily candle can be told as PO3, so a pile of finished charts proves nothing. The test is whether you can name the manipulation leg while it is happening.
Write it as a rule
A testable Judas swing, on M15 and New York time: price trades below the midnight open and below the low of the quiet range from 00:00 to 02:00, then an M15 candle closes back above the midnight open before 05:00. Both parts, or it is not one.
Worked example
Example 01: EURUSD M15: the rule says Judas swing
The worked example, with every number walked through, is in the app.
Go deeper
In Example 01 the drop reached 1.08440, and the 03:45 candle closed at 1.08702, just back above the open.
When the rule says no
Same rule, same start. It never fires.
Worked example
Example 02: GBPUSD M15: the same start, no Judas swing
The worked example, with every number walked through, is in the app.
Call it bar by bar in the backtester
M15 from 00:00 New York. At 05:00, call Judas or not, then play on.Tag the trades that used it
Judas, and drops that missed the rule No reclaim.Go deeper
In the backtester, check afterwards how many Judas days closed above the open. In the Trade Log, filter by each tag after a month and compare the two in R.
Check yourself
Quick review · 0 of 0