ICT Master Liquidity - How To Use Them
A Thread 🧵
A Thread 🧵
1. What is Liquidity?
Liquidity is important in trading because it shows how much buying or selling is happening.
Liquidity acts like a magnet, pulling the price toward areas where there are a lot of buyers or sellers.
when prices change, they usually move toward places where there's lots of trading activity.
Liquidity is important in trading because it shows how much buying or selling is happening.
Liquidity acts like a magnet, pulling the price toward areas where there are a lot of buyers or sellers.
when prices change, they usually move toward places where there's lots of trading activity.
2. How to understand and use Liquidity?
Liquidity is essential for traders to consider for:
- Confluence
- Target
In simpler terms, it impacts Take profit and Stop loss strategies.
Liquidity is essential for traders to consider for:
- Confluence
- Target
In simpler terms, it impacts Take profit and Stop loss strategies.
3. How to MASTER liquidity?
Step by step
Step 1
- Wait for the LIQUIDITY SWEEP.
- Observe the response to the high time frame (HTF) Point of Interest (POI).
- Identify the Liquidity sweep.
- Note the significant DOJI candle during the liquidity grab.
- It signals a trend change.
Step by step
Step 1
- Wait for the LIQUIDITY SWEEP.
- Observe the response to the high time frame (HTF) Point of Interest (POI).
- Identify the Liquidity sweep.
- Note the significant DOJI candle during the liquidity grab.
- It signals a trend change.
Step 2
- Price is expected to increase following the liquidity sweep.
- The significant volume displacement / FVG enables a higher price movement.
- As the price approaches resistance, it undergoes a shift.
- Price is expected to increase following the liquidity sweep.
- The significant volume displacement / FVG enables a higher price movement.
- As the price approaches resistance, it undergoes a shift.
Step 3
- The price loses temporary LTF support.
- As a trader, your intention is to enter upon the formation of FVG.
- If the price regains the shift (temporary support), it signifies a LONG position.
- The price loses temporary LTF support.
- As a trader, your intention is to enter upon the formation of FVG.
- If the price regains the shift (temporary support), it signifies a LONG position.
Step 4
- Price hits TAKE PROFIT.
- Price recovers momentum, triggering buying pressure, and hits TP.
- Note the TP's positioning relative to a liquidity hole/area.
- Place SL BELOW the Liquidity sweep (STEP 1).
- Incorporate liquidity as confluence and target.
- Price hits TAKE PROFIT.
- Price recovers momentum, triggering buying pressure, and hits TP.
- Note the TP's positioning relative to a liquidity hole/area.
- Place SL BELOW the Liquidity sweep (STEP 1).
- Incorporate liquidity as confluence and target.
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