Liquidity Sweeps and Stop Hunts
Understand why price often spikes past obvious highs or lows to trigger retail stop losses before reversing in the intended direction.
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Liquidity sweeps are important because obvious highs and lows often attract clusters of stop-loss orders.
I believe understanding liquidity helps traders avoid entering too early around obvious support and resistance levels.
A sweep alone is not enough for me. I would wait for a clear market structure shift before considering a reversal.
The interesting part is observing how price behaves after taking liquidity. That reaction often provides valuable information.
Instead of placing stops at obvious levels, traders should focus on proper risk management and wait for confirmation before entering.
