If you have ever gone long into a breakout only to have the price suddenly reverse and hit your stop-loss, you are not alone. The same situation happens to many traders alike, especially during a false breakout. Well, what if you convert those tricky situations into smart opportunities? That´s what the ICT Turtle Soup Pattern empowers you to do.
In this article, you will learn what the Turtle Soup pattern is, how it works, when to use it, and strong entries with clear stop-loss and take-profit levels.
Therefore, if you are a beginner or trying to sharpen your trading skills, the strategy gives you a cutting edge.
So let’s take it easy, step by step.
ICT Turtle Soup Pattern: What is it?
ICT Turtle Soup is a smart-money concept that deals with false breakouts in the forex market. Whenever you have a price breaking above resistance or below support, only to reverse very quickly, that is your set-up for Turtle Soup.
The pattern effectively runs stop orders above key resistance or below key support levels. Institutional traders go one way to set off the retail stops, then reverse back for the clear profit. You are simply following in the footsteps of smart money to make a profit on the trapped trader.
Structure & Conditions for Valid Setup
This entire setup is possible only when some sharp market conditions create a perfect storm for false breakouts, which qualifies this as a Turtle Soup. The highlights are a precisely defined range of consolidation just respected by price at certain highs and lows.
The first condition is identifying a major swing high or swing low, tested time and time again. These levels act like magnetic pools for retail stop losses. You see, the more times a level is tested, the more it becomes attractive for liquidity hunting.
The second option has to do with volume and momentum. When price breaks these levels, you want momentum to be weak or volume to be low. Strong breakouts with solid volume create authentic moves, while weak breakouts suggest potential reversals.
The third critical point is a very rapid reversal back into range. A valid pattern will show a breakdown of price through the level, stay outside for a very short time, and slip back inside within a few candles. This fast return signifies a false breakout, suggesting that the reversal is probably going to continue.
Bullish Turtle Soup Setup (Buy Example)
In bullish setups, you’re looking for the price to break below support, only to quickly reverse higher. Start by identifying clear support tested at least 2-3 times.
The reversal typically shows as a strong bullish candle closing back above broken support. This candle often has a long lower wick, showing rejection of lower prices. Your setup is confirmed when the price starts making higher highs after returning above support.
Bearish Turtle Soup Setup (Sell Example)
The bearish version targets false breakouts above resistance levels. Look for well-defined resistance that the price has tested multiple times without breaking convincingly.
The key signal comes when the price quickly reverses back below resistance, often forming bearish engulfing or shooting star patterns. Your setup gains strength when price makes lower lows after returning below resistance.
Entry Techniques (Conservative vs Aggressive)
Conservative traders wait for complete confirmation before entering. Wait for the price to return to the range and show additional signals like second tests or structure breaks.
Aggressive traders enter on a reversal candle formation. If you spot a hammer closing above a broken support, enter immediately. This offers better risk-to-reward but requires more skill in reading price action.
Stop Loss Placement
For bullish setups, place stops below the lowest point of the false breakdown with a few pips buffer. In bearish setups, stops go above the highest point of the false breakout.
Never risk more than 1-2% of your account on any single trade. Even high-probability setups can fail, and proper risk management keeps you trading long-term.
Take Profit Targets
Your first target sits at the opposite end of the range where the false breakout occurred. If the price breaks below support, target the resistance at the top of the range.
Second targets extend beyond the range to previous significant levels. Look for historical support/resistance, round numbers, or Fibonacci extensions. Consider closing portions at different levels to maximize profits.
Best Timeframes & Sessions to Use
The 15-minute and 1-hour charts provide an excellent balance between signal frequency and reliability. Daily charts work well for swing traders but occur less frequently.
Trade during London (2:00-11:00 GMT) and New York (12:00-21:00 GMT) sessions for best results. These periods offer high liquidity and institutional activity needed for reliable patterns.
Common Mistakes to Avoid
Avoid these common mistakes:
- Don’t trade against the trend. Always check the bigger picture.
- Never enter before a clear reversal. Wait for signs like market structure breaks or strong candles.
- Don’t skip your stop loss. It’s better to lose a small amount than blow your account.
Stick to your rules and stay patient.
Conclusion
The ICT Turtle Soup Pattern is a powerful way to trade smart. It helps you avoid fake breakouts and enter the market when others are getting trapped. Knowing how to use the setup under good market conditions can help you increase effectiveness in winning trades. If you are patient while applying the strategy, then it will surely turn into one of your treasured setups in trading.
FAQs
Will the Turtle Soup Pattern work on all forex pairs?
Yes! Works great on the common pairs like EUR/USD, GBP/USD, and even gold (XAU/USD) — as long as there is enough movement there.
Which are the best timeframes to use?
You can view setups on 1-hour or 4-hour charts for entry in 5-minute or 15-minute timeframes.
Are indicators required for this strategy?
Not at all. You would need to have an understanding of price action, support/resistance, and market structure shifts.
Is this pattern for beginners?
Of course! Practice and step-by-step learning would make this simple and effective for any trader.
