🧲 LIQUIDITY, WHAT DOES IT MEAN?
Have you ever seen the price almost touch your Stop Loss, then suddenly reverse direction? 👀
One concept traders need to understand is liquidity.
Liquidity can be understood as an area that contains many orders, such as stop losses and pending orders. Such areas often draw attention because there are many orders that can be executed when price reaches them.
📌 3 areas you must pay attention to:
1️⃣ Liquidity at Support
Many stop losses for long positions can gather below support.
2️⃣ Liquidity at Resistance
Stop losses for short positions and sell orders can gather above resistance.
3️⃣ Previously High & Low
Swing highs/lows are often interesting to watch because many traders place orders around those levels.
⚠️ But remember:
A liquidity sweep doesn’t always mean the price will definitely reverse.
After liquidity is taken, price can: ➡️ Reverse
➡️ Continue the trend
➡️ Form a false breakout
So don’t just look at the wick. Also pay attention to market structure, volume, trend, and confirmation.
🎯 Don’t rush into an entry. Find out first: “Where is the liquidity?”
In your opinion, is BTC currently aiming for liquidity above or below? 👇
$BTC
Have you ever seen the price almost touch your Stop Loss, then suddenly reverse direction? 👀
One concept traders need to understand is liquidity.
Liquidity can be understood as an area that contains many orders, such as stop losses and pending orders. Such areas often draw attention because there are many orders that can be executed when price reaches them.
📌 3 areas you must pay attention to:
1️⃣ Liquidity at Support
Many stop losses for long positions can gather below support.
2️⃣ Liquidity at Resistance
Stop losses for short positions and sell orders can gather above resistance.
3️⃣ Previously High & Low
Swing highs/lows are often interesting to watch because many traders place orders around those levels.
⚠️ But remember:
A liquidity sweep doesn’t always mean the price will definitely reverse.
After liquidity is taken, price can: ➡️ Reverse
➡️ Continue the trend
➡️ Form a false breakout
So don’t just look at the wick. Also pay attention to market structure, volume, trend, and confirmation.
🎯 Don’t rush into an entry. Find out first: “Where is the liquidity?”
In your opinion, is BTC currently aiming for liquidity above or below? 👇
$BTC
