Trading patterns cheat sheet [2024]
explain “Liquidity”
1. Where is the Liquidity? To spot liquidity, you need to know which trend the market is following. In a downtrend = Liquidity is found on the UPPER SIDE of the chart In a uptrend = Liquidity is found on the LOWER SIDE of the chart 1.1 Where is the Liquidity? Liquidity rests at previous Highs in a downtrend. On HTF, Liquidity points will be at PDL, PDH, PWL and PWH 1.2 Where is the Liquidity? After a strong selling or buying level is formed, Liquidity will build accumulation around those areas. When a sweep in the price occurs, it targets the supply or demand zones, to provide the necessary Liquidity for the next move. 2. Liquidity Sweep A liquidity sweep occurs when significant market players execute large-volume trades to trigger the activation of a cluster of pending buy or sell orders This action typically results in rapid price movements and targets what are known as liquidity zones. 2.1 Shift with Displacement A Shift indicates a potential reve...
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