"The market doesn't move randomly. It moves toward liquidity. If you don't understand liquidity, you're trading blind." 📍One of the biggest misconceptions in trading is believing that price moves because buyers are stronger than sellers.🤔 In reality, markets need orders to function. Large institutions can't enter or exit positions without enough opposing orders available. That's where liquidity comes in. 📍Liquidity is simply where a large number of pending orders are sitting in the market. These orders are often found: - Above obvious highs - Below obvious lows - Around support and resistance levels - Near areas where traders place stop losses Because institutions need liquidity to execute large positions, price is often drawn toward these areas before making its next significant move. This is why you'll frequently see price take out a high or low before reversing. The market isn't necessarily chasing your stop loss specifically, it's actually seeking liquidity. 📍To understand better, see the video quoted above. And have this in mind "THERE WILL BE NO SIGNIFICANT MOVEMENT IN PRICE, UNTIL LIQUIDITY HAS BEEN SWEPT". Follow @Dioslev for more Technical topics.

🧵🧵🧵 📍Liquidity is simply where a large number of pending orders are sitting in the market. These orders are often found: - Above obvious highs - Below obvious lows - Around support and resistance levels - Near areas where traders place stop losses Because institutions need liquidity to execute large positions, price is often drawn toward these areas before making its next significant move. This is why you'll frequently see price take out a high or low before reversing. The market isn't necessarily chasing your stop loss specifically, it's seeking liquidity.

📍Buy-Side Liquidity is a pool of orders sitting above a previous high. These orders typically come from: - Traders placing buy-stop orders to catch a breakout. - Traders who are short and have their stop losses above the high. When price reaches these highs, all those orders become available. This creates a liquidity pool that institutions can use to enter, exit, or rebalance positions. That's why you'll often see price aggressively push above a previous high before deciding its next direction. The key lesson? A previous high isn't just a level on a chart, it's a magnet for liquidity.

Yesterday, we covered Buy-Side Liquidity—orders resting above highs. Today, let's look at the opposite side of the market: 📍 Sell-Side Liquidity; Understanding this concept will help you stop selling at the worst possible time. Sell-Side Liquidity is a pool of orders sitting below previous lows. These orders usually come from: - Traders placing sell-stop breakout orders. - Traders who are long and have their stop losses below the low. Because so many orders accumulate beneath obvious lows, these areas become attractive targets for the market. This is why you'll often see price dip below a previous low, trigger stops and breakout sells, and then suddenly reverse. The market isn't necessarily breaking down. It's often collecting liquidity first. Remember: Every obvious low is a pool of potential liquidity.

📍Equal Highs = Liquidity Pool When you see two highs at the same level, as an informed trader, don't see resistance See liquidity. One of the easiest liquidity pools to spot on any chart is Equal Highs. ^^ 📍Equal Highs occur when price reaches roughly the same high level multiple times. To retail traders, it looks like a strong resistance level. But something else is happening. Above those highs, you'll often find: - Breakout buy orders - Short traders' stop losses - Traders waiting for confirmation to enter And this is where liquidity builds, price is often attracted to. That's why you'll frequently see the market push above Equal Highs before making its next major move. The longer the highs remain untouched, the more attractive they become like a magnet.

Want to learn how to frame Bias ? Monthly, weekly or Daily?. Check for the quote, it'll be in a video format.

📍 CONTINUATION AND REVERSALS When price closes below or above a previous candle, it usually suggests a continuation in that price action - if price closes inside a previous candle after breaking off before, it usually would suggest a reversal - But if we put Key level into consideration, then everything changes. Watch the video attached in quote to understand this simple price action trick.

Should I drop the video Yes or No.

And it didn't hold like i expected. By 3pm i'll drop the short video i made last night on Supposed protected highs / lows.