Key SMC concepts include Order Blocks (areas where institutional traders entered positions), Fair Value Gaps (imbalances in price movement), liquidity zones (areas where stop-losses cluster and get hunted), and Break of Structure (shifts in market trend direction).

These building blocks form the vocabulary of SMC trading. An Order Block is typically a bearish candle preceding a strong upward move, representing where institutional buyers stepped in. Fair Value Gaps appear when price jumps between two candles without filling the gap, signalling an imbalance. Liquidity refers to areas where the market has been trapped before — institutions use these to hunt for stops and then reverse. Break of Structure marks the moment the market shifts from one trend to another, and Change of Character describes a shift in the underlying market mood. Together, these concepts give traders a way to read institutional footprints on a chart.