Hello traders
-Today we will talk about liquidity and its role.
What is liquidity?
-We will try to explain you as simple as possible what liquidity is and what you should be looking for when you want to spot it.
-There is a theory on the FX markets that the Big institutions (Smart money) are always trying to trap us and take our Stop losses.
-Retail education as we all know is based on patterns (double top,double bottom, trendlines, supp res zones etc...
-As new traders come fresh on the markets they can be easily manipulated and taken away from their money because they are 'easy pray for big boys.
-If you want to understand liquidity as simple as possible - when there is a trend line, double top pattern, there are retail stop losses and there is liquidity to be taken.
Example:
1) In this example, we see that the price is moving in a downtrend
2) Then the price slows down with momentum and starts to make a lot of liquidity.
3) We can see liquidity in the form of a trendline, double tops, etc.
4) A lot of retail traders lose their money here, while we patiently wait for our opportunity.
5) Our entry is at the strong supply zone, and the price reaches it when it picks up all SL of retail traders.
6) At the end, we see a liquidity sweep that mostly happens in one move, and here we open our position.
-Remember: This is the cat and mouse game. In order for one person to win someone else needs to take the loss. So our question is
Are you a cat or a mouse?
-If this post helped you better understand the concept of liquidity, leave a like. If you have any questions, write below in the comments.
-Today we will talk about liquidity and its role.
What is liquidity?
-We will try to explain you as simple as possible what liquidity is and what you should be looking for when you want to spot it.
-There is a theory on the FX markets that the Big institutions (Smart money) are always trying to trap us and take our Stop losses.
-Retail education as we all know is based on patterns (double top,double bottom, trendlines, supp res zones etc...
-As new traders come fresh on the markets they can be easily manipulated and taken away from their money because they are 'easy pray for big boys.
-If you want to understand liquidity as simple as possible - when there is a trend line, double top pattern, there are retail stop losses and there is liquidity to be taken.
Example:
1) In this example, we see that the price is moving in a downtrend
2) Then the price slows down with momentum and starts to make a lot of liquidity.
3) We can see liquidity in the form of a trendline, double tops, etc.
4) A lot of retail traders lose their money here, while we patiently wait for our opportunity.
5) Our entry is at the strong supply zone, and the price reaches it when it picks up all SL of retail traders.
6) At the end, we see a liquidity sweep that mostly happens in one move, and here we open our position.
-Remember: This is the cat and mouse game. In order for one person to win someone else needs to take the loss. So our question is
Are you a cat or a mouse?
-If this post helped you better understand the concept of liquidity, leave a like. If you have any questions, write below in the comments.