Liquidity Sweep + BOS Trades [Enhanced]

The Liquidity Sweep + BOS Trades [Enhanced] indicator identifies high-probability trading opportunities by detecting liquidity grabs followed by market structure shifts in alignment with the prevailing trend. This tool automates the detection of ICT-based price action concepts to help traders find precision entries during trend reversals or continuations.

Usage

The indicator can be used to spot trade setups based on a three-step confirmation process:

1. Liquidity Sweep: The script identifies when price breaches a previous pivot high or low but fails to sustain that level, suggesting a "stop run" or liquidity grab.
2. Break of Structure (BOS): After the sweep, the script looks for a price move that breaks the recent internal market structure in the opposite direction.
3. Trend Filter: To increase the win rate, signals are filtered by a long-term Exponential Moving Average (EMA). Bullish signals are only valid when price is above the EMA, and bearish signals when price is below it.

Trade signals are displayed directly on the chart with "BUY" and "SELL" labels when all conditions—sweep, BOS, and trend alignment—are met simultaneously.

Details

The script utilizes confirmed pivot points to establish historical liquidity levels. A buy sweep occurs when the low of a candle drops below a previous pivot low but closes back above it. Conversely, a sell sweep occurs when the high exceeds a previous pivot high but closes below it.

The Market Structure Shift (BOS) is calculated based on the highest high or lowest low over a specified lookback period. The script effectively combines mean reversion (the sweep) with momentum (the BOS) to find optimal entry points.

Settings

• Pivot Lookback: Determines the number of bars used to identify pivot highs and lows for liquidity levels.
• Trend EMA: Sets the length of the Exponential Moving Average used as a directional trend filter.
• Show Trade Signals: Toggles the visibility of the "BUY" and "SELL" labels on the chart.

FAQ

How do I interpret the dashed lines? The horizontal dashed lines represent the most recent historical pivot highs (red) and lows (green) that the script is currently monitoring for potential liquidity sweeps.

Can I use this on any timeframe? Yes, the logic is applicable across various timeframes, though it is commonly used on lower timeframes for day trading entries or higher timeframes for swing trading identification.

How can I access Liquidity Sweep + BOS Trades [Enhanced]? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.