Join me in a deep dive into liquidity! Learn about the different types, stop hunts, and high impact news events that shape the market. A must-read for all traders! 👇
1/7 Liquidity is defined by stop losses & there are two types of liquidity: Buy Stops Liquidity (BSL) & Sell Stops Liquidity (SSL)
2/7
BSL is created by stop losses of sell orders and used by banks to place sell orders.
SSL is created by stop losses of buy orders. Banks sometimes manipulate prices to activate stop losses & place their positions in the market, a technique known as Stop Hunt
3/7 To spot BSL, focus on Previous Month High, Previous Week High, Previous Day High, High Of Day, Old High & equal highs (Retail Resistance)
4/7 To spot SSL, focus on Previous Month Low, Previous Week Low, Previous Day Low, Low Of Day, Old Low & equal lows (Retail Support)
5/7 High impact news events can also be used to hunt liquidity in the market. Keep an eye on the news calendar to know which pairs will be affected by high impact news events
6/7 When BSL is taken, the market reverses to the downside. When SSL is taken, the market reverses to the upside.
7/7 Boost your Forex knowledge! Understanding liquidity and these market dynamics will help you make informed trading decisions. #TradingEducation .
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1. Order blocks in forex trading are special zones of supply and demand formed due to the accumulation of orders from banks and institutions. These large players, such as central banks, drive the market, making it important for traders to understand the concept of order blocks.
2. What are Order Blocks ?
Order blocks are created when banks split their orders into smaller, manageable chunks, in order to control the impact their orders may have on the price of an asset. This allows them to place their orders without disrupting the market.