---
title: 'Understanding ICT PD Array: A Beginner''s Guide'
source: 'https://youtube.com/watch?v=q15cIITjB24'
video_id: 'q15cIITjB24'
date: 2026-08-17
duration_sec: 1716
channel: 'Solomon King'
---

# Understanding ICT PD Array: A Beginner's Guide

> Source: [Understanding ICT PD Array: A Beginner's Guide](https://youtube.com/watch?v=q15cIITjB24)

## Summary

This video provides a comprehensive beginner's guide to the ICT (Inner Circle Trader) concept of PD Array (Premium/Discount Array). The instructor explains how to identify and prioritize various institutional reference points, such as mitigation blocks, breaker blocks, liquidity voids, fair value gaps, order blocks, and rejection blocks, to make informed trading decisions. Using BTC/USD as an example, the video demonstrates how to apply these concepts across different time frames to refine entries and align with higher-time-frame order flow.

### Key Points

- **Introduction to PD Array** [00:02] — PD Array stands for Premium/Discount Array. It involves arranging institutional reference points by priority and defining institutional order flow. Understanding this concept is essential for trading with the smart money concept.
- **Market Fundamentals** [01:28] — Markets thrive on price and time. Price delivers liquidity from discount to premium and vice versa, repeating this cycle within a defined range. The first step is to identify the PD Array on higher time frames (monthly, weekly, daily) before moving to lower time frames.
- **Defining Premium and Discount** [03:12] — Using a Fibonacci tool on a defined trading range, the 50% level is the equilibrium. Above equilibrium is premium (expensive), below is discount (cheap). Smart money buys at discount and sells at premium, following basic business principles.
- **Priority Order for Discount Levels** [04:41] — When price reaches a discount level, prioritize institutional reference points in this order: mitigation block, breaker block, liquidity void, fair value gap, order block, rejection block, and old highs/lows. Use market structure (change of character, break of structure) to confirm.
- **Mitigation Block Identification** [05:21] — A mitigation block is a failure swing where price attempts to create a new high but crashes down. It is a former bullish order block that failed to hold, and when price returns to this level, it can be used as an entry point.
- **Breaker Block Identification** [06:16] — A breaker block occurs when a level that previously acted as support breaks and becomes resistance (or vice versa). For example, a bullish order block that is broken becomes a bearish breaker block, offering a selling opportunity when price retests it.
- **Liquidity Void (Imbalance)** [07:53] — A liquidity void is a sudden impulse move that leaves an imbalance in price delivery, where price quickly moves from one level to another without trading in between. This is also called a buy-side imbalance or sell-side inefficiency, and price often returns to fill this void.
- **Fair Value Gap (FVG)** [08:45] — A fair value gap is a three-candle price action pattern where the low of the first candle and the high of the third candle do not overlap, leaving a gap. This gap acts as an area of interest where price often retraces before continuing its trend.
- **Order Block Identification** [10:27] — An order block is the last opposite-colored candle before a strong move. For a bearish order block, it's the last bullish candle before a downward move; for a bullish order block, it's the last bearish candle before an upward move. Institutions place large orders here.
- **Rejection Block Identification** [12:42] — A rejection block is a three-candle pattern where the middle candle has the highest wick, indicating rejection of higher prices. The bodies of the candles should be relatively equal for validity. Price often bounces from this area.
- **Old Highs and Lows** [14:24] — Old highs and lows are liquidity areas where price often grabs liquidity before reversing. These levels are visible on any time frame and can be used as potential support or resistance zones.
- **Practical Application on BTC/USD** [15:43] — The instructor demonstrates applying the PD Array on BTC/USD, showing how to prioritize a fair value gap over an order block when price is in discount. He emphasizes using higher time frames (weekly, monthly) to confirm the order flow and then refining entries on lower time frames.
- **Using Higher Time Frames for Confirmation** [17:39] — After identifying a discount level, the instructor checks the weekly and monthly charts for fair value gaps and liquidity pools. This helps confirm the institutional order flow and increases the probability of a successful trade.
- **Entry Refinement on Lower Time Frames** [19:50] — Once the higher time frame order flow is bullish, the instructor looks for a retracement to an institutional reference point on a lower time frame (e.g., daily) to find a precise entry. He uses a change of character (CHoCH) to confirm the shift in market structure.
- **Current Market Application** [26:38] — The instructor applies the PD Array to the current BTC/USD price, identifying a fair value gap at a discount level and suggesting that price may react from this area. He advises going to lower time frames to refine the entry.

### Conclusion

The PD Array is a powerful tool for organizing institutional reference points and aligning trades with the overall order flow. By prioritizing these levels and using higher time frames for confirmation, traders can improve their entry precision and increase their chances of success.

## Transcript

everything you need to know about PD array as taught in the ICT concept once you understand how PD array Works you're going to do wonders with the smart money concept this is one of the topics in the smart money concept that you cannot
ignore what exactly is PD array this is the first thing we're going to start P simply means premium D simply means discount and then array simply means arrangement of items so what this basically means is that you're going to
learn how to practically arrange your institutional reference point according to order of priority and then secondly you're going to learn how to clearly Define your institutional order flow these are the two things that once you
get you'll be able to trat any financial asset and that is why I'm using btcusd in this particular video to show you that this Concepts can work across any financial asset so what you are seeing here is a practical representation of
how to use this concept there are a lot of you people that ask me questions like how do we prioritize this which of these ones do we give more priority to is it an order block is it a fair value Gap or is it a mitigation block so all these
ones have their importance and I'm going to show you how to practically prioritize them so what exactly do we have whenever we see a market the market thrives on two things the first one is price and then the second one is time
these are the two m things that the market thrives on whenever you see price delivering liquidity from one side or the other it is always repeating itself it delivers liquidity from discount to premium from premium to Discount and
this is a clearly defined range the first thing to do is to find your PDR in higher time frames such as monthly time frame weekly time frame and the daily time frame and then later you can go down to lower time frames and take your
going to start getting your institutional order flow but there are some other institutional reference point that I make mention of here that some of going to show you how to identify them on a chat then we come back and continue
with our premium discount array by the way you can also find relevant tutorials on my YouTube channel still on the smart money concept you can see there are a lot of videos on the smart money concept if you come to playlist and you check
this particular playlist SM money concept you're going to get a lot of video it is going to take a bit longer so make sure you finish the rest on my YouTube channel that is where you're
going to get the complete video so look at this what we have here is a range we see a clearly defined range when we see something like this normally when we trade we want to see that price has delivered liquidity from a very clearly
defined range what we have here is a movement from movement from this low to this old high okay so from here to here when we use our Fibonacci tool we're going to get the complete
defined trading range which is identified by this movement middle of this movement you can see that is the 50% level of that Fibonacci 2 it is 50% level of that Fibonacci 2 it is known as the equilibrium level it is
known as the equilibrium level then above the equilibrium we have our premium level that's from here to Here is known as your premium and then below your equilibrium level from here to Here is known as your discount so what
happens in the market is simply people buy from a discount and deliver it at buy from a discount and deliver it at premium that's basic business principle you buy low you sell high that is basic business principles and that's what the
smart money are taken advantage of they buy at discount and then they sell at premium premium means expensive so what you see here every time remember when we take trades we want to see that movement comes and then retracement we look for
an Institutional order flow okay what we look for maybe can be an order block it can be a fair value Gap that is basically what the smart money concept drives on so we're going to arrange them in order of priority okay if we bring
in order of priority okay if we bring this one here you may need to just take note of all these things and then we bring this one here when we are dealing with a discount level once price came to a discount level we're going to
prioritize them according to this we're going to start by looking for a mitigation block and then if we cannot find mitigation block we go to a breaker block if we cannot find a breaker block we will go to a liquidity void if we
cannot find a liquidity void so on and so forth that is how we're going to Prior ize them but it does not mean once price reaches here and you see a you're going to use your basic understanding of the smart money concept
such as Market structure when you see a change of character break of structure I'm subsequently going to show you that I'm just trying to explain how these things work for you so let me show you how to basically
identify a mitigation block and a breaker block because I think some of clearly defined video on those subject matter in this playlist very powerful subject matter mitigation block and the breaker block so a mitigation block
looks like something like this can you see this movement from here to here it's just like a failure swing where you have price comes to this level and then tries to push and create a new high but all of a sudden crashed down and then this that
a sudden crashed down and then this that was supposed to be a bullish order block remember when you have a movement like this and it comes back this may be your from here and take it up again but it never rejected price from here it just
traded through it and then took liquidity below it if price comes back this is now your entry this is how people trade mitigation blocks this is now your entry at this level this is how to identify a mitigation block I will
show you that on a chart and then this is a breaker block why is it a breaker because it has broken the last high that was formed something like this and then was formed something like this and then it Came Crashing Down to the low side if
price comes back to this place this level let me show you this area this is where you can confidently enter your thread because of this block it is no thread because of this block it is no longer a bullish order block but a
breaker block this time around a bearish breaker block we have a bullish breaker have a bullish breaker block and a bearish breaker block just like an other block and then this is also a bearish mitigation block so when we are dealing
with pdra we will need to prioritize this first according to the arrangement once price retraces below your 50% let me put a
horizontal line there this line and then delete this guy let me delete this one so we can have it so from what we are seeing this is our 50% level if price comes to this level this is where we're supposed to start
preparing to take our trades and then create a new high just like you see happen here okay and then we're going to start looking for a mitigation block which is something like this this guy if we cannot find it we go to a
breaker which is something like this this guy if we cannot find it we'll go to a liquidity void what is a liquidity void a liquidity void is when you see price suddenly leaves a particular level look at this range let me show you what
I'm saying can you see a range here this particular range this trading range after this range has held price for a while it suddenly had an Impulse swing
while it suddenly had an Impulse swing high so this that you see a very huge candlesticks that printed is called a liquidity void it's simply a buy side imbalance it is an imbalance in price delivery where you see price quickly
delivers liquidity from this level to this level where there are no sellers buy side imbalance cell side inefficiency so this is what we call a liquidity void I'm going to show you those things one by one please make sure
you watch to the end I'm going to take time but you're going to get a lot of value in this particular video this is a topic you should not ignore the next one is your fear value Gap I know fear value Gap is something that I've explained
time and time again but let me show you what a fa value Gap is so a fa value Gap three candle price action whether in the bullish direction or in the bearish Direction with something like this look at what I'm saying you see one two three
in the bearish side a healthy price delivery should have this one can you see the low of this candle the low of this first one if you're counting from here to here the low of this candle does the weak and the high of this candle
must be connected like it must stad through each other to connect that will give you a healthy price delivery just like you can see here 1 2 3 you can see the low of this and the high of this are connected so this is a healthy price
connected so this is a healthy price action but this it left a gap G okay and this is the gap let me show you this is the the gap okay this is the gap I hope this is
properly drawn so this is the gap that is left and this Gap is simply what we is left and this Gap is simply what we call a fair value Gap so what price does is that it will always come back to this Gap okay it will always come back to
this Gap and then trade down maybe to push price to to another level this Gap just pay attention to this information so this is how to identify a fair value Gap the candle color does not matter the candle color does not matter you just
and then you're going to identify it let me delete everything here because I will be coming back here I don't want it to be too rowdy it is very important that you watch everything here so the next one to do is to check for an order block
an order block is one of the thing that almost everybody knows how to identify let me go to a meta Trader 4 and see how we can identify an order block an order block we have a bearish order block and a bullish order block an order block is
simply when you see price moving let me see if I can see something like this can you see this movement price came push push to this area when you see price push to this area the last bullish candle that price printed in this regard
let me expand it a bit the last bullish candle that price printed as price is moving this bullish candle some people will just mark it like this and draw it to this level so they expect price to come back as price come back to this
level we expect to see price push down what it means is simply where institutions have taken their large order block simply means large order
order block block order okay so people will mark this level and then expect price to come back and they will sell from that area and then once you see liquidity cleared Above This level it even makes it more clearer and then we
have an order block above that area and you can see another one here this green candle in this Regard in a bullish Trend you want to see the last bullish candle that price traded that is your bearish order block because it will be the one
to make price bearish so you can see after price came back it just touches it and come down and likewise for a bullish order block is the last last red candle order block is the last last red candle that price printed before moving up uh
let me see if I can see one okay this guy this last red candle that price printed is your bullish order block if I expand it you're going to see it now I
definition of an order block some people will say take the one that took liquidity but this is what was originally taught from where I learned an order block so this is the order block not this guy except if you are
dealing with demand and Supply I will teach you about demand and Supply but teach you about demand and Supply but this is your order block a bullish order block I hope this is understandable the next one is rejection block rejection
block can be seen where you have uh pretty much equal highs candles that are printing equal highs now a rejection block can be seen when you have a price action of three candles just like this let me show you this 1 2 3 okay and then
you have have the middle candle with the highest week just like you see this one so this is your rejection block this is your rejection block so you expect price to bounce around this area you can see price came and bounc
around that area that is a rejection block let's see a rejection block a three candle price action look at this a three candle price action 1 2 3 the three candle price action 1 2 3 the middle one has the highest week this is
a rejection block I have a video about this on my YouTube channel I think you should go and check it I explain it in detail how to even practically take threads with it uh rejection block is basically seen like that let me see if I
can see another one a last one then we can go to the next item I hope I'm able to see a rejection block they are not easily seen on the chart people confuse them with other blocks but they are not other blocks let me see if I can see a
one I don't want to waste more time but I hope you go to my channel and get more videos about a rejection block a three candle price action where the middle candle has the highest week one 2 three relatively equal body that is one of the
relatively equal body that is one of the thing also the bodies must be equal and that will make it more valid so this guy price came and reacted around it this is a rejection block so this is according to order of priority rejection block and
to order of priority rejection block and then old highs and old lows basically at any time frame you are you're going to see old highs and old lows where price may come and grab liquidity above those levels so you can see them these are old
highs old highs old lows you can see what you see around old highs and old lows are basically liquidity areas where price will come and grab liquidity grab liquidity below this place came back and this is you can see it call lows at this
area you can see them you can see a lot of of them old highs old lows all these ones are old highs and old lows that you can find on your chart this is an old high you can see price actually came grabed liquidity and old high at this
area price came and grabed liquidity Above This level an old high an old high so this is how to see an old high and old low so once we have finished understanding this now we're going to put them bring this one here so when you
see price comes you know how to prioritize them bring this one here okay with what we have right here if I use my replay to let me see if I can have this seeing it from this perspective what we have here let me adjust this clearly so
have here let me adjust this clearly so we can see it properly what we have here is basically a movement remember this is our 50% level that is the equilibrium price moved from here to here and then it is coming back how do we do it is now
below discount so we start looking from here here do we have a mitigation block no do we have a bullish breaker we don't have do we have a liquidity void yes we have a liquidity void and then we are seen price trying to fill it up it is
simply an imbalance price is filling it up the next one is do we have a fair value Gap yes we have a fair value Gap where it is this is it can you see the high of this candle and the low of this candle 1 2 3 three candle price action
we just place our line here let me see if I can get it this clearly let me just carry this two and have it like this okay so this is a fair value Gap
this is a fair value Gap let me adjust it properly so you can see what I'm saying so you can see this is a fa value Gap clearly seen so we have seen one and did price actually reacted at that point yes price is reacting at this point so
we have seen according to order of priority once your are in discount level you have seen according to order of priority so we will prioritize fair value Gap than what than an order Block in this regard this is an order block
let me show you this is an order block but I'm not saying this is certain you have to use your understanding of price delivery and see because sometimes the institutions may not just respect this and just bounce here you have to watch
time frame so you will be able to know exact order block a bullish order Block in that area but it's reacting around here so we will go to a lower time frame once
we see something like this we will go to weekly let's see from weekly what do we have if we can see from weekly that means we can have an Insight this is why institutional order flow now what is exactly is your order flow we are in a
discount and a discount level is basically where people buy an asset they buy it low and they sell high so look at this from this area we are seeing that same area the weekly fair value Gap is this guy and look at this the monthly
fair value Gap is this guy below the 50% level and look at it relatively equal level and look at it relatively equal low what do we find around this area is basically where liquidity is residing it is basically where liquidity
is residing let me bring this here this is where liquidity is residing and price came grabed liquidity in the lower time frame in the lower time frame that is the weekly still on the concept of our
PD array we have arranged them properly we are now seeing the action so this is a rejection sign a sign of rejection so we can confidently say okay this fair
value gab now can give us what we want because we can prioritize it so we can play it and see how it goes this is why I said you need to pay attention to your understanding of how smart money concept operates such as structureal break of
are seeing price now look at what happened price has actually reacted from here that means that monthly fair value Gap that we drag this line this big Line Gap that we drag this line this big Line is now acting and then we see a change
of character that's Market structure shift there is a shift in Market structure from from a lower low this is a lower low lower low we can see a lower high lower high and then we change direction so we can confidently say that
this fa value Gap is what these institutions wants to use so we can prioritize it now and say this is what we want now we look out for a retracement back to another institutional order flow we patiently
look out for that this is basically how I do my PDR so looking at this we're going to see how it happens we don't enter thread here except if you just is happening that is why you have to work with the rhythm of price action
even though from here you can see price moved from here to this place to this particular level this is a mitigation block at this area this is a mitigation block from this retracement down here okay let me show you what I'm saying
this swing from this swing to this level to the last level of this place this movement look at at the middle line we are in a premium level
and we come here when we come here we can see mitigation block is prioritized a mitigation block look at what I'm saying remember that our drawing a mitigation block is something like this let me show you how to identify a
mitigation block this is a mitigation block a failure swing it did not take the high it just crashed down going back to the weekly now to see that if we find it but the most important thing is that the institutional order flow this time
around please don't get confused the institutional order flow is bullish and then in the higher time frame we are at a discount but look at this it came push a discount but look at this it came push from here to here came down had a
from here to here came down had a failure swing came to this area came to this level where is your mitigation block this guy this last red candle that price printed and price reacted from that level it's trying to push down to
come maybe to look for another institutional refer point before pushing now it will align with the higher time frame order flow that is a bullish movement so let's not get confused I'm just trying to show you how this is done
whenever you're taking threads so let me delete this guy the most important thing has been shown so looking at what is happening we can now take trades but what do we look out for if we will Define this movement from here to here
we can take our Fibonacci to place it here keep it up here and then what do we here keep it up here and then what do we see 50% level below equilibrium we are see 50% level below equilibrium we are at a discount we are at a discount and
then what do we look out for from discount let me see if I can keep this clean from this count these are the things we look out for we start from mitigation block do we have a mitigation block no breaker block do we have a
breaker block this is looking like a breakout block to me because we take the low here remember this time around a bullish breaker block something like this when you have a movement of something like this let me show
something like this let me show you it creates a low came back test and then take up I hope you're watching this clearly from the distance so look at this this is how a bullish breaker block is formed so look at this do we have
something like that push came down and we can see this has pushed so I'm tempted to call this a bullish breaker even though it's this green candle that I'm supposed to pay attention to um let's see what do we have do we have a
fair value Gap yes we we have a fair value Gap look at this a fair value Gap a very small fair value Gap here in between this guy and that guy a very small fa value Gap so we don't need to pay attention to that breaker a very
small fair value Gap here that came so we can prioritize this which means we need to go to lower time frame and find an entry that is in the daily we can find an entry to get into that if we go to the Daily time frame all this we're
doing in order to find an entry using the PD array so the price is trying to create a new high then you can go to the Daily and find an entry probably that can gives you a better Advantage now this is the daily time frame okay look
at what is happening here in the daily time frame we have a change of character from this upward movement came down and it is coming let's see what is
happening according to our order of priority what we see here price came to this level is this an order block let's see this guy this order block can you
see did we see an order block yes we can see an order block and then a fa value see an order block and then a fa value Gap to in the daily time frame a fair value Gap at this area let me delete this guy this is a fair value Gap at
this area in the Gap so this is how you can refine your entry you can go lower to the lower time
frame and find the beta entry knowing the fact that the higher time frame order flow is bullish the higher time frame order flow is bullish let's go back to the weekly and I'm going to show you what I'm seeing coming back to our
you what I'm seeing coming back to our weekly we are still upward from monthly we have a fair value Gap that is pushing price up and then we are seeing it price up and then we are seeing it coming up to that level then we went to
the weekly to have our entry refined after a change of character came back we could find an entry here and then we push price and after pushing price we're going to see where price is heading basically price came and fill up that fa
value Gap and then started moving up moving up moving up it created a new high this is exactly the goal the goal is to create a new high and if we can go to the monthly time frame we're going to see it the goal is to create a new high
and price actually did that so let's see what we have right here we can see that a new high was created premium and discount level has been seen let me delete this guys so
we can have a clean chart so this is basically our chart so from discount it took it to premium again so you can see how to prioritize your
institutional reference point clearly without any hesitation let's see what is happening as we play it to play out if we have what we are seeing right there
price is playing out let me completely delete it so we can see what we have there as a whole without playing it as replay so price actually came back after taking it to a premium level and delivering liquidity from
there as I told you price delivers liquidity from discount premium premium to Discount now from premium to Discount this is it from this is it from this from this area to this place so
from here to this place we are still waiting for price to push up again so BT waiting for price to push up again so BT BC is currently at a discount level what do we have at this discount level where BTC is we can see that we have old low
BTC is we can see that we have old low let's take it at this discount level we start from a mitigation block do we have a mitigation block at this area where Bitcoin is we don't have a mitigation Block Breaker do we don't have breaker
liquidity void we have a liquidity void which has been filled up fair value Gap yes we have a fair value Gap this guy let me show you at the current market State this is where the F value Gap is and price is currently there this place
price is currently here you can see what I'm saying and then we can see some reaction reaction coming in so we can confidently say that this guy can act as our level of Interest so we can go to
the lower time frame and refine our entry until we find an entry that will take price to the premium level so this is actually how to arrange your institutional reference point in order of priority the PD array above your
equilibrium is premium below your equilibrium is Discount I hope this video is helpful if you find Value here make sure you give this video a like and make sure you subscribe to this YouTube channel you have any question let me
know this is just a very very basic explanation of how to use the guys that you're going to do a lot with this information thank you for watching this information thank you for watching see you in the next video