GLOSSARY · MARKET STRUCTURE
What is Liquidity Sweep?
A liquidity sweep is a quick push through a key high or low that triggers stops, then reverses.
Price briefly breaks an obvious level, triggers the stop orders resting there, and snaps back inside. The sweep traps breakout traders and often marks a short-term reversal.
Traders look for a candle that wicks through the level but closes back inside it.
EXAMPLE
NQ dips 8 points below the overnight low at 9:42, then closes the 5-minute candle back above it. Shorts who sold the break are trapped — a sweep long.
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