Don’t assume a trend reversal just because the price took out your stop. The most expensive mistake in the market is exactly this. Sometimes price sweeps liquidity and reverses. Other times, it uses that liquidity as fuel and continues in the same direction. The difference between these scenarios is explained by BSL, SSL, and iFVG. BSL — Buy-side liquidity Accumulates above equal highs and previous peaks. When price reaches this level, it collects stop losses from short positions and breakout buyers. SSL — Sell-side liquidity Accumulates below equal lows and previous troughs. When price reaches this level, it clears stop losses from long positions. Liquidity Sweep Simply breaking a level is not enough. What matters most is how price behaves after the sweep. If there’s a rapid reversal, the likelihood of a trap increases. iFVG Reversal An iFVG forms when a broken FVG begins working in the opposite direction. If price holds the iFVG as support, the bullish scenario strengthens; if it rejects the iFVG as resistance, the bearish scenario strengthens. In short, the correct sequence is: Find the liquidity. Wait for the sweep. Watch for the iFVG reaction. Make your decision only after structural confirmation. Because liquidity absorption is not a trade signal. The market’s reaction after absorbing liquidity is the true signal. Which do you think traps you more often: The BSL sweep at the top, or the SSL sweep at the bottom?
Chartist | Süleyman 💲🦁Share

Source:Show original
Disclaimer: The information on this page may have been obtained from third parties and does not necessarily reflect the views or opinions of KuCoin. This content is provided for general informational purposes only, without any representation or warranty of any kind, nor shall it be construed as financial or investment advice. KuCoin shall not be liable for any errors or omissions, or for any outcomes resulting from the use of this information.
Investments in digital assets can be risky. Please carefully evaluate the risks of a product and your risk tolerance based on your own financial circumstances. For more information, please refer to our Terms of Use and Risk Disclosure.