Power of three (AMD) in gold trading
Power of three, or AMD, is the ICT model of a session in three phases: accumulation in a range, manipulation that sweeps one side, then distribution.
Also called PO3, Accumulation-manipulation-distribution, AMD
The power of three describes how ICT expects a candle, session or day to unfold. Accumulation: price builds a range near the open while positions are gathered. Manipulation: price makes a false move against the eventual direction, sweeping the liquidity on that side and trapping early traders. Distribution: price then moves in the true direction for the rest of the period. Seen on a daily candle, the manipulation is the wick against the close and the distribution is the body.
How it applies to gold trading
On gold the model maps onto the sessions. The Asian session is often the accumulation range. The London open frequently delivers the manipulation, sweeping one side of the Asian range (the Judas swing). The London and New York sessions then provide the distribution. A trader using the model forms a daily bias, waits for the manipulation against it, and enters once structure shifts back in the bias direction, targeting the opposite side of the range and beyond.
The model is a template rather than a rule: many days do not follow it, and the manipulation can be the real move when a news release lands. Its value is in reminding traders that the first move of the session is often the trap.
A common mistake
Assuming every London-open move is manipulation and fading it. The model only works with a bias; without one, the trader cannot tell which side is the trap.
See also: Judas swing, Asian range, Liquidity sweep, London open.
Frequently asked questions
How do I use power of three on gold?
Set a bias from the higher timeframe, treat the Asian range as accumulation, expect the London open to sweep the side opposite your bias, and look for entries after structure shifts back in the bias direction.
Is power of three the same as Wyckoff accumulation and distribution?
They share the idea of ranges followed by manipulation and markup. Wyckoff describes it over longer campaigns; power of three applies it to a single candle, session or day.