Higher Timeframe Bias: How to Trade With Institutional Flow

The Number One Rule

If you take one thing from ICT methodology, it should be this: trade in the direction of the higher timeframe. Counter-trend trading on the lower timeframe while the higher timeframe is trending is the single most common reason ICT traders fail. The HTF trend will override your 5-minute order block every time.

Higher timeframe bias isn't a suggestion — it's a filter. Before you even open a lower timeframe chart, you need to know: is the HTF bullish, bearish, or ranging? Every trade you take should align with that answer.

Market Structure: BOS and MSS

Break of Structure (BOS): When price takes out a swing high in an uptrend or a swing low in a downtrend, it confirms the existing trend direction. BOS is a continuation signal — the trend is intact.

Market Structure Shift (MSS): When price takes out a swing point against the prevailing trend — a swing low in an uptrend or a swing high in a downtrend — it signals a potential reversal. MSS is the first warning that the institutional money may be changing direction.

The key distinction: BOS confirms, MSS warns. A single MSS doesn't guarantee a reversal, but it means you should be cautious about continuing in the previous direction until the market proves otherwise.

Determining Your Daily Bias

Before each trading session, work through this hierarchy:

1. Weekly chart: What's the overall trend? Are we in a weekly dealing range or trending? Is price in premium or discount of the weekly range?
2. Daily chart: Is the daily making higher highs and higher lows (bullish) or the opposite? Was the most recent swing point a BOS or MSS?
3. 4-Hour chart: Does 4H structure align with daily? If 4H is bearish while daily is bullish, be cautious — you may be in a pullback.
4. 1-Hour chart: This is where you refine. If Weekly, Daily and 4H are all bullish, you're looking for 1H bullish setups during kill zones.

When all timeframes agree, you have a high-conviction bias. When they disagree, reduce position size or sit out.

The Dealing Range

ICT's dealing range concept breaks every price swing into two halves: premium (the upper half) and discount (the lower half). Smart money buys in discount and sells in premium — it's that simple.

Once you identify the current HTF dealing range (the most recent significant swing high and swing low), you can calculate equilibrium (the 50% level). Above equilibrium is premium territory, below is discount. Bullish entries in discount, bearish entries in premium — this is the premium/discount model that underpins all ICT trading.

Multi-Timeframe Alignment Levels

The most powerful setups occur when concepts from multiple timeframes converge at the same price level:

• A daily order block that sits inside a weekly FVG
• A 4H FVG at the equilibrium of the daily dealing range
• A 1H order block at the CE of a 4H FVG during the NY kill zone

Each additional layer of confluence increases the probability of a reaction. This is why multi-timeframe analysis isn't optional — it's the core of finding high-probability setups.

Practical Workflow

• Sunday evening: Mark weekly and daily levels, determine weekly bias, identify the dealing range
• Before each session: Check 4H structure, note unmitigated OBs and FVGs, confirm or update bias
• During kill zones: Drop to 15m/5m, find setups aligned with your established HTF bias
• After the session: Review whether the day confirmed or shifted the bias for tomorrow

When Bias Is Unclear

Sometimes the HTF is genuinely ranging — no clear BOS in either direction, price oscillating between defined highs and lows. In these conditions, you have two options: trade the range extremes (buy at the range low, sell at the range high) or simply don't trade until a directional bias emerges. The second option is often the more profitable one.