Liquidity - Fragility

Now we are going to dive into the concepts of protected/unprotected area's in your chart. These can vary depending on how liquidity reacts around those price points with your instrument

————-- 011 - Targeting weak rollovers

Now we know what we want to see. When price is indecisive, weak and there is not a lot of one-sided momentum, we want to target those double, triple tops/bottoms. Either that or closeby market structure such as higher high and higher low near each other. -> This is a standard 1-2 method, see it as an alley-oop the market throws at you, and all you need to do is slam dunk it.

When the market tries to trade away from this, we will try and trade INTO it.

These weak area’s is where price is attracted to, drawn to. The infamous magnet.

**Here you see price created a low, it moved up for a bit, but then came right back down near those previous lows. After it has created that base, that brick wall, it will pull back to pick liquidity up in order to break it. 

No need to focus on entry models just yet, you must understand the flow first. Look at the candles and see how they form that weak low. Price rapidly moves in somewhat clear structure. Remember. From low resistive to high resistive.

That makes that rollover? 

Weak… which we target !

————-- 012 - Protected low

What do we understand from this? Price is coming from a bearish trend, but has run the weak sell side liquidity prior to this new break to the downside.

The key here is to see whether or not price will then break previous structures prior to breaking sell side liquidity. 

Each trade , each move is a transaction. With a purpose. Actions.

That is why, if the new low, in this case, broke previous structure before the break, we can conclude that the purpose of that move was to grab further liquidity to move upwards.

This is then backed by the bullish orderflow, these will be PDA’s. Could be orderblocks, displacements, shift zones etc.. Don’t worry about that just yet.

What that translates to is that the low created will be protected, it makes it a high resistance area, strong, so the rollover is strong as well.

————-- 013 - Unprotected low

then it comes to an unprotected low see it as the freshest low that was created from the expansion downwards, in this case. It forms small unclear structure, but not concise patterns, no good directional bias.

Price in this case looks a bit rigged, it looks messy. Uncertain.

What does that remind you of? Price is liquid during this time, it’s transactable, but there  are too many participants in the market for clear direction.

Everyone is content with the price at which they are bidding and asking for. So no need for accumulations or distributions.

But this area, especially the week lows, will be used to gain liquidity for further direction. We dont try and predict which direction, but we use this area as a draw on liquidity and potential target which we want to slam through.

————-- 014 - Consolidations

When it comes to price consolidating, and moving sideways in a range, we notice that there is liquidity being built up above/below price.


More on that later, but the important thing to note here is that the price is too close to target any liquidity on either side to build structure in between.

You must start to see the range, how you can anticipate realistic consolidations, and assume that one end of the consolidation is prone to break.

Going back to the three question rulebook. It is not rocket science that we can conclude that price might go up or down..

But we are trying to find the most probable scenario, and simply react to what the market gives us.

Going back to this scenario, when price is shaken out. The market is not giving us much to react upon. Know when to sit on your hands.

Knowing when not to trade, is also trading.

————-- 015 - HTF orderflow

**Sometimes we have liquidity on both sides, as mentioned before, we dont try to predict to were it will go from that moment. We react towards our most probable scenario.

Our most probable scenario is in this case what the underlying higher timeframe bias is. We use the higher timeframes as a parent figure to the lower timeframes. 

This implies that if the hourly timeframe would be bullish lets say, and there is a consolidation happening on your ETF’s  ( Execution timeframe ). There is obviously the chance that both sides will get swept, but that the overall direction will remain the same of the parent timeframe.**


————-- 011 - Targeting weak rollovers

Now we know what we want to see. When price is indecisive, weak and there is not a lot of one-sided momentum, we want to target those double, triple tops/bottoms. Either that or closeby market structure such as higher high and higher low near each other. -> This is a standard 1-2 method, see it as an alley-oop the market throws at you, and all you need to do is slam dunk it.

When the market tries to trade away from this, we will try and trade INTO it.

These weak area’s is where price is attracted to, drawn to. The infamous magnet.

**Here you see price created a low, it moved up for a bit, but then came right back down near those previous lows. After it has created that base, that brick wall, it will pull back to pick liquidity up in order to break it. 

No need to focus on entry models just yet, you must understand the flow first. Look at the candles and see how they form that weak low. Price rapidly moves in somewhat clear structure. Remember. From low resistive to high resistive.

That makes that rollover? 

Weak… which we target !

————-- 012 - Protected low

What do we understand from this? Price is coming from a bearish trend, but has run the weak sell side liquidity prior to this new break to the downside.

The key here is to see whether or not price will then break previous structures prior to breaking sell side liquidity. 

Each trade , each move is a transaction. With a purpose. Actions.

That is why, if the new low, in this case, broke previous structure before the break, we can conclude that the purpose of that move was to grab further liquidity to move upwards.

This is then backed by the bullish orderflow, these will be PDA’s. Could be orderblocks, displacements, shift zones etc.. Don’t worry about that just yet.

What that translates to is that the low created will be protected, it makes it a high resistance area, strong, so the rollover is strong as well.

————-- 013 - Unprotected low

then it comes to an unprotected low see it as the freshest low that was created from the expansion downwards, in this case. It forms small unclear structure, but not concise patterns, no good directional bias.

Price in this case looks a bit rigged, it looks messy. Uncertain.

What does that remind you of? Price is liquid during this time, it’s transactable, but there  are too many participants in the market for clear direction.

Everyone is content with the price at which they are bidding and asking for. So no need for accumulations or distributions.

But this area, especially the week lows, will be used to gain liquidity for further direction. We dont try and predict which direction, but we use this area as a draw on liquidity and potential target which we want to slam through.

————-- 014 - Consolidations

When it comes to price consolidating, and moving sideways in a range, we notice that there is liquidity being built up above/below price.


More on that later, but the important thing to note here is that the price is too close to target any liquidity on either side to build structure in between.

You must start to see the range, how you can anticipate realistic consolidations, and assume that one end of the consolidation is prone to break.

Going back to the three question rulebook. It is not rocket science that we can conclude that price might go up or down..

But we are trying to find the most probable scenario, and simply react to what the market gives us.

Going back to this scenario, when price is shaken out. The market is not giving us much to react upon. Know when to sit on your hands.

Knowing when not to trade, is also trading.

————-- 015 - HTF orderflow

**Sometimes we have liquidity on both sides, as mentioned before, we dont try to predict to were it will go from that moment. We react towards our most probable scenario.

Our most probable scenario is in this case what the underlying higher timeframe bias is. We use the higher timeframes as a parent figure to the lower timeframes. 

This implies that if the hourly timeframe would be bullish lets say, and there is a consolidation happening on your ETF’s  ( Execution timeframe ). There is obviously the chance that both sides will get swept, but that the overall direction will remain the same of the parent timeframe.**


————-- 011 - Targeting weak rollovers

Now we know what we want to see. When price is indecisive, weak and there is not a lot of one-sided momentum, we want to target those double, triple tops/bottoms. Either that or closeby market structure such as higher high and higher low near each other. -> This is a standard 1-2 method, see it as an alley-oop the market throws at you, and all you need to do is slam dunk it.

When the market tries to trade away from this, we will try and trade INTO it.

These weak area’s is where price is attracted to, drawn to. The infamous magnet.

**Here you see price created a low, it moved up for a bit, but then came right back down near those previous lows. After it has created that base, that brick wall, it will pull back to pick liquidity up in order to break it. 

No need to focus on entry models just yet, you must understand the flow first. Look at the candles and see how they form that weak low. Price rapidly moves in somewhat clear structure. Remember. From low resistive to high resistive.

That makes that rollover? 

Weak… which we target !

————-- 012 - Protected low

What do we understand from this? Price is coming from a bearish trend, but has run the weak sell side liquidity prior to this new break to the downside.

The key here is to see whether or not price will then break previous structures prior to breaking sell side liquidity. 

Each trade , each move is a transaction. With a purpose. Actions.

That is why, if the new low, in this case, broke previous structure before the break, we can conclude that the purpose of that move was to grab further liquidity to move upwards.

This is then backed by the bullish orderflow, these will be PDA’s. Could be orderblocks, displacements, shift zones etc.. Don’t worry about that just yet.

What that translates to is that the low created will be protected, it makes it a high resistance area, strong, so the rollover is strong as well.

————-- 013 - Unprotected low

then it comes to an unprotected low see it as the freshest low that was created from the expansion downwards, in this case. It forms small unclear structure, but not concise patterns, no good directional bias.

Price in this case looks a bit rigged, it looks messy. Uncertain.

What does that remind you of? Price is liquid during this time, it’s transactable, but there  are too many participants in the market for clear direction.

Everyone is content with the price at which they are bidding and asking for. So no need for accumulations or distributions.

But this area, especially the week lows, will be used to gain liquidity for further direction. We dont try and predict which direction, but we use this area as a draw on liquidity and potential target which we want to slam through.

————-- 014 - Consolidations

When it comes to price consolidating, and moving sideways in a range, we notice that there is liquidity being built up above/below price.


More on that later, but the important thing to note here is that the price is too close to target any liquidity on either side to build structure in between.

You must start to see the range, how you can anticipate realistic consolidations, and assume that one end of the consolidation is prone to break.

Going back to the three question rulebook. It is not rocket science that we can conclude that price might go up or down..

But we are trying to find the most probable scenario, and simply react to what the market gives us.

Going back to this scenario, when price is shaken out. The market is not giving us much to react upon. Know when to sit on your hands.

Knowing when not to trade, is also trading.

————-- 015 - HTF orderflow

**Sometimes we have liquidity on both sides, as mentioned before, we dont try to predict to were it will go from that moment. We react towards our most probable scenario.

Our most probable scenario is in this case what the underlying higher timeframe bias is. We use the higher timeframes as a parent figure to the lower timeframes. 

This implies that if the hourly timeframe would be bullish lets say, and there is a consolidation happening on your ETF’s  ( Execution timeframe ). There is obviously the chance that both sides will get swept, but that the overall direction will remain the same of the parent timeframe.**


Complete Lesson