Liquidity Sweep Hunter

The Liquidity Sweep Hunter indicator is a systematic liquidity detection tool designed to identify when price hunts Buy Side Liquidity (BSL) and Sell Side Liquidity (SSL) around key swing levels. This tool provides real-time visualization of liquidity grabs, helping traders identify potential reversals and trap moves based on confirmed price action.

Usage

The Usage section focuses on identifying institutional stop hunts and liquidity cycles. The indicator automatically tracks swing highs and lows, designating them as pools of liquidity. When price interacts with these levels, the tool identifies "sweeps" using specific logic:

• Buy Side Liquidity (BSL): Occurs when price sweeps above a previous swing high and closes back below it. This often indicates a bearish reversal or a "stop run" on short sellers.
• Sell Side Liquidity (SSL): Occurs when price sweeps below a previous swing low and closes back above it. This often indicates a bullish reversal or a "stop run" on long buyers.

Traders can use these signals in confluence with other Smart Money Concepts (SMC) like Order Blocks or Fair Value Gaps. The tool provides visual labels (BSL/SSL) and chart signals (triangles) on the confirmation candle to ensure signals do not repaint.

Details

The script employs a non-repainting pivot detection engine to establish reliable market structure. It manages the lifecycle of liquidity levels by tracking them through three stages: active, swept, or removed (based on age).

The detection engine utilizes two primary modes:

• Wick Sweep: Price extends a wick beyond a level but the candle body closes back within the range.
• Retest Sweep: Price successfully breaks a level but subsequently reclaims it, identifying a "trap" move.

To improve signal quality, an ATR-based volatility filter is used. This ensures that only wicks of a meaningful size relative to recent market volatility are flagged as valid liquidity grabs.

Settings

Swing Detection

• Swing Lookback: Determines the sensitivity of pivot high and low detection.
• Sweep Mode: Choose between Wick, Retest, or Both for identifying sweeps.
• Max Active Levels: Limits the number of liquidity lines tracked on the chart.
• Max Level Age (bars): Automatically removes levels after a certain number of bars to maintain relevance.
• Max Visible Sweeps: Controls the number of historical sweep labels displayed.
• Show Signals (recent bars): Restricts signal plotting to a specific lookback window to reduce clutter.

Filters

• ATR Length: The lookback period for the Average True Range volatility calculation.
• Min Wick ATR Mult: Sets a minimum threshold for the sweep wick size based on ATR.

Display

• Show Level Lines: Toggles the visibility of active liquidity levels.
• Show Sweep Labels: Toggles the "BSL" and "SSL" text labels.
• Bullish/Bearish Sweep Color: Customizes the colors for SSL and BSL events.
• Level Line Color: Adjusts the styling of the projected liquidity lines.

FAQ

How do I interpret the BSL and SSL labels? BSL (Buy Side Liquidity) suggests price has cleared out buy stops above a high, potentially leading to a bearish move. SSL (Sell Side Liquidity) suggests price has cleared out sell stops below a low, potentially leading to a bullish move.

Does this indicator repaint? No, all signals and labels are confirmed only upon the candle close to ensure stable and reliable historical data.

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