Smart Money Concepts (SMC)
Smart Money Concepts, usually just called SMC, grew directly out of ICT's ideas — it's less a rival framework and more a simplified, more standardised repackaging of the same core beliefs, which is why the vocabulary overlaps so heavily. SMC traders talk about "smart money" (the large institutional players) leaving detectable footprints, same as ICT, but the terminology and rules tend to be a bit more codified — which is also why SMC concepts show up constantly in free chart indicators and trading-view scripts.
Break of Structure and Change of Character are usually the central concepts in SMC teaching, often the very first thing taught, since almost everything else in the framework builds on correctly identifying the current trend and spotting the moment it shifts.
Where ICT talks about order blocks specifically, SMC often uses the broader term supply and demand zones — areas where a strong move originated, whether or not it fits the exact strict definition of an order block. The idea is functionally the same: a zone worth watching for price to return to.
SMC adds one framework that isn't as central in classic ICT teaching: premium and discount zones. Take the recent trading range, split it into an upper "premium" half and a lower "discount" half around a 50% equilibrium line, and the basic idea is to look for buys in the discount half and sells in the premium half — buying relatively cheap, selling relatively expensive, within the current range.
A useful nuance called mitigation is also common in SMC: an order block or supply/demand zone that price has already partially traded back into is considered "partially mitigated" and treated as weaker evidence than a zone price hasn't touched at all — the more a zone gets revisited, the less untapped institutional interest is thought to remain there.
Key takeaway
SMC is ICT's core ideas, simplified and standardised — same footprints, same liquidity logic, plus its own premium/discount framework for timing entries within a range.
Example
Gold pulls back into the discount half of its recent range, right into an unmitigated demand zone, after a clear break of structure to the upside — three SMC signals agreeing at once, which is exactly the kind of confluence SMC traders look for before entering.
Try this
Take any recent price range on a chart you know. Mark the halfway point. Is price currently sitting in the cheap (discount) half or the expensive (premium) half of that range?
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