7trade Smart Money Concepts: market structure, levels and sweeps
Smart Money Concepts marks up the chart by itself: where the market is making a move and where the move broke, where support and resistance are, where the crowd's stops sit and when they were swept. After this article you will understand every element of the markup, the three views, the events for strategies and all the settings. How to turn the indicator on is covered in "7trade bot: introduction".
Why it is useful
Traders usually draw markup by extremes by hand: highs, lows, zones, levels. The indicator does it for you by the same rules every time and does not look ahead — on each bar it knows only what has already happened.
The markup is adapted for binary options:
- the "Levels" view — only the two nearest levels above the price and two below it, with the role written in the tag;
- distance in moves per trade — the tag gives not only the level price but also how many typical moves during your trade it is away;
- liquidity sweep — a mark on an exact bar: zones and levels answer "where", a sweep answers "when";
- sloped lines — optional, with a breakout mark.
Below is a live chart on real candles in the "All" view. Click it to open it large; there a click on a markup element shows its explanation. The ⚙ icon opens the settings window.
Glossary
The markup is labelled with the words from this list. It is also in the settings window, in the "Glossary" section.
| Word | Meaning |
|---|---|
| Structure | A staircase of highs and lows: higher than before — a move up, lower — a move down |
| Continuation | The close went beyond the last extreme in the direction of the move: the move is confirmed |
| Structure break | The close went beyond an extreme against the move: the first claim for a reversal |
| Order block | The bar the move that broke the structure started from. When the price returns to it, a bounce is expected |
| Broken block | A block the price closed beyond. It changes its role: former support becomes resistance, and the other way round |
| Price gap | Three candles where the wick of the first did not reach the wick of the third: the price was skipped without trading. It is seen as a magnet — the price comes back to fill it |
| Liquidity pool | Two highs or two lows at the same height: stops sit behind them |
| Sweep | The price went beyond a level with a wick and closed back: the stops were taken, but no move followed |
| Range edge | The last high and low of the move. Strong — the one the move started from; weak — the one the market can still sweep |
| Support and resistance | A level below the price and a level above it. The role depends on the position relative to the price, not on how the level appeared |
| Sloped line | A line from a high downwards or from a low upwards |
| Line breakout | The first close beyond a sloped line |
| Premium and discount | The upper and lower parts of the last range: "expensive" and "cheap". Between them is equilibrium |
What is on the chart
| Element | Meaning |
|---|---|
| Zigzag through the extremes | The skeleton of the market: a segment to a new high is a move up, to a new low a move down. The last segment, going to the price, is pale: its peak is not confirmed yet |
| Slanted cross at an extreme | Structure break — the first extreme broken against the previous move. A continuation has no cross: it is visible on the zigzag itself |
| Small hollow cross | A break of the small swings inside the move. Their zigzag is not drawn, but the "structure break" and "structure extreme sweep" events are calculated from them |
| Dark band from a bar in the past | Order block — bullish or bearish. Only live blocks are shown |
| Band with borders only, in its own colour | Broken block: its role is reversed. It disappears when the price comes back beyond it |
| Band between wicks | Price gap. The colours deliberately do not follow direction: a gap is a trace of speed, not a side. Off at the start |
| Thin line through two extremes | Liquidity pool. A swept or broken level disappears |
| Rhomb below or above a bar | Sweep: a wick through a level with a return. Below the bar — swept from below, up expected; above — swept from above, down expected |
| Barely visible fill at the top and bottom | Premium and discount. Off at the start: the zones float together with the extremes |
| Sloped lines and triangles | Lines from extremes and their breakouts. Off at the start |
| Tags on the right | Level prices; in the "Levels" view with the role, for example "res. · block · 1.4 moves" |
A block or gap band starts at its own bar in the past but becomes known later. Its left part is always drawn after the fact. You can enter "from a block" only from the bar where it appeared on the chart.
Hints
Click a zone, a level, a cross or a rhomb to see a plate: what it is, what is expected from it and when it will disappear, with a coloured dot and an action — "CALL", "PUT" or "Wait". The plate stays until you click elsewhere. Under the line is the market state: where the structure is looking, where the price is in the range, which pool is closer and when the last sweep was. To make the plate appear on a mouse hover too, turn on "Show the explanation on hover" in the "View" section — it is off at the start.
Three views
The "What to show" switch in the "View" section. The view does not affect the calculation or the events.
| View | What you see |
|---|---|
| Levels | Only support and resistance: the two nearest levels above the price and below it. The tag has the role, the price, the kind of level and how many moves per trade away it is. This is the starting setup |
| Structure | Where the market is going: the zigzag, breaks as crosses, sweeps as rhombs, range edges. No zones |
| All | The full markup: zones, breakouts as a line labelled "break" or "cont.", pools, sweeps, range edges |
A level in the "Levels" view is a block, a broken block, a pool or a range edge. Which one is written in the tag. Two tags close in price merge into one.
Events for strategies
In the "Strategies" window the events are listed with the prefix "SMC:". CALL and PUT are the trade direction.
| Event | When it fires | CALL / PUT |
|---|---|---|
| liquidity sweep — equal highs or lows | The price pierced a pool with a wick and closed back. Once, on the return bar. A close beyond the level is not a sweep but a breakout | Swept from below / swept from above |
| liquidity sweep — structure extreme | The same on the last extreme of the small swings. Fires more often: an extreme always exists, while an equal pair forms rarely | Low swept / high swept |
| structure break | The close broke the last extreme of the small swings against the previous move | Up / down |
| structure wave — move up or down | State: the last broken point of the large structure is a peak or a trough. It answers which way to look at all | Move up / move down |
| return to an order block | The price returned to a block for the first time. Once per block | Bullish block / bearish block |
| return to a broken block | The price returned to a block that was broken by a close before. The block's role is reversed | Broken bearish / broken bullish |
| price gap formed | Three candles with a gap formed on this bar | Bullish / bearish |
| return to a price gap | The price entered an unfilled gap for the first time | Bullish / bearish |
| sloped line breakout | The close went beyond the sloped line from the last extreme. Works even if the lines are hidden on the chart | Above the line from a high / below the line from a low |
"Structure wave" is a state, true for many bars in a row. Use it as a confirmation of a transition event, for example of a sweep: "swept from below, and the move is up".
All settings
The window opens with the ⚙ icon — on the SMC card in the "Indicators" window or in the panel header below the chart. If the markup is drawn over the candles — with the pencil in its line of the chart legend. While a strategy with SMC is running, the panel uses that strategy's settings, not the window's.
View
| Field | What it does |
|---|---|
| What to show | The view: "Levels", "Structure" or "All" |
| Show price tags | Tags to the right of the last bar, where the platform keeps its own price marks |
| Explain the markup on hover and click | The main switch for the plates. It does not affect hints about candlestick patterns |
| Show the explanation on hover | The plate follows the mouse. Off at the start |
| Add the market state to the plate | Four lines about the market in a pinned plate |
Market structure
| Field | What it does |
|---|---|
| Show the structure wave and breaks | The zigzag and the crosses |
| Swing structure length, bars | How many bars must pass an extreme for it to count as a large one. The zigzag is drawn by it. It is also a delay: at 10 a turn appears 10 bars after the peak |
| Breakout depth, share of the previous leg | How deep the close must go beyond an extreme for the breakout to count. 0 — any exit breaks the structure. 0.1 — a tenth of the last swing. Affects everything at once: the wave, the blocks and the events |
| Internal structure length, bars | The same for the small swings. Their zigzag is not drawn, but the break and sweep events are calculated from them |
Blocks and imbalances
| Field | What it does |
|---|---|
| Show order blocks | Block bands |
| Show imbalances | Price gap bands. Off at the start |
| How many blocks to keep | How many live blocks stay on the chart: a new one pushes out the oldest. The same number limits the gaps |
| Smallest imbalance, share of ATR | Gaps smaller than this share of the average volatility do not count — otherwise the markup would turn into a solid fill |
Liquidity
| Field | What it does |
|---|---|
| Show equal extremes | Pool lines |
| Show sweep marks | Rhombs |
| Extreme confirmation, bars | How many bars to the left and right must be clear for a bar to count as an extreme for an equal pair. More — pairs form less often |
| Equality tolerance, share of ATR | How far two extremes may differ and still count as equal. On a calm market the tolerance narrows by itself |
| Return beyond the level, bars | Within how many bars the price must come back for a pierce to count as a sweep. 1 — a pierce and a return on one bar, the strictest rule. More — a false breakout is allowed, but you learn about the sweep later |
Premium and discount
| Field | What it does |
|---|---|
| Show premium and discount zones | The fill at the top and bottom of the range. Off at the start |
| Share of the range per zone | Which part of the range at the top counts as premium and at the bottom as discount. A quarter from each edge leaves half for equilibrium |
| ATR period | The window of the average volatility. The equality tolerance and the smallest gap are measured with it too |
Sloped lines
In the bot the lines are off at the start: tick the first checkbox and they appear in the "Structure" and "All" views. On the charts in this article they are already on, so you can see them.
| Field | What it does |
|---|---|
| Show sloped lines and breakouts | Lines and breakout triangles |
| How to build the line | "Constant slope" — from each extreme the line goes with the set steepness. "Through two peaks" — the classic line through the last two highs (the second lower) or two rising lows |
| Line length, bars | How many bars on each side of an extreme are needed for a line to start from it. More — fewer lines, and they appear later |
| Steepness | The slope multiplier. 0 — the line is horizontal. Only for a constant slope |
| What to measure the slope with | "ATR" — the slope grows with the candle range; "Spread" — with the spread of closes; "Regression" — with the strength of the move before the extreme. Only for a constant slope |
Move per trade
| Field | What it does |
|---|---|
| Expiry, bars | Trade length in bars. On M1 a bar is a minute: 3 is a three-minute trade |
| Typical move — over how many bars | Over how many recent bars the typical price move per trade is calculated |
Tags and plates use this measure to say how far the price is from a level. It does not affect the markup itself. Set the same time as the trades in your strategy.
Presets
| Preset | What it sets |
|---|---|
| 1-min trade | Distances to levels in price moves over one bar |
| 3-min trade | Over three bars — the starting setup |
| 5-min trade | Over five bars: the move is larger, and the same levels are closer in moves |
Glossary and Legend
"Glossary" has the same words as the table at the start of the article. "Legend" lists all markup colours; each can be changed. Here is also the button that returns all settings to the starting ones.
What SMC does not do
- It does not know the future. The markup is built only from closed bars. A block, a pool or a level says where the price may be held, not that it will be held there.
- It does not enter trades by itself. Trades are opened by a strategy from the "Strategies" window.
- It does not show an extreme at once. A peak becomes a peak only a few bars after itself — this is built into the structure length.
- It does not keep spent zones. A block the price closed beyond becomes broken. When the price closes back beyond it, it disappears. A gap disappears when the price has gone right through it.
Frequently asked questions
Why is the last segment of the zigzag pale? Its peak is not confirmed yet: the market has not passed it by the required number of bars. It may turn out not to be where it seems.
Where did the block go? Either the price closed beyond it, it became broken, and then the price closed back. Or a new block pushed it out: the chart keeps as many blocks as set in "How many blocks to keep".
How is a sweep different from a breakout? A sweep is a wick through a level with a close back. A breakout is a close beyond the level. After a breakout the level disappears.
Why are there no price gaps and sloped lines? They are off at the start so the chart does not turn into hatching. Turn them on in the "Blocks and imbalances" and "Sloped lines" sections.
I changed a setting, but the markup is the same. If a strategy with SMC is running, the panel uses its settings. Stop the strategy or change the settings inside it.
What's next
- Twin Range — a filter line and a quiet zone over the candles.
- Candlestick patterns — patterns the bot outlines right on the chart.
- Strategies — the builder — how to build a rule from events.