Liquidity Sweep Detector

The Liquidity Sweep Detector indicator identifies zones where institutional players hunt stop losses and flags the precise moment a "sweep" occurs. By tracking multiple support and resistance zones simultaneously, the tool helps traders recognize when smart money grabs liquidity before a potential reversal, allowing them to align their trades with institutional flow.

Usage

The indicator maps liquidity zones based on pivot points and monitors price action relative to these levels. A "sweep" is detected when the price wicks through a zone but closes back within it, signifying a liquidity grab.

Traders can use the indicator for:

• Stop Placement: Identifying liquidity clusters to place stops beyond zones where most retail traders are hunted.
• Entry Confirmation: Waiting for a sweep signal to confirm that stops have been cleared before entering a reversal.
• Strength Analysis: Zones that have been tested multiple times without breaking appear stronger, indicating levels that institutions are actively defending.
• Bias Assessment: The real-time dashboard provides a market bias based on the frequency of bullish versus bearish sweeps.

Details

The script tracks up to 16 simultaneous zones, maintaining a historical view of market structure. Unlike basic pivot indicators, this tool scores zone strength based on tests and volume. It implements logic to detect "wick-and-snap-back" patterns, which are characteristic of institutional accumulation or distribution.

Settings

Zone Detection

• Pivot Lookback: Controls the sensitivity of the zones. Lower values create more zones and signals, while higher values focus on significant swing points.
• Max Active Zones: Limits the number of unbroken zones tracked per side.
• Zone Range: Choose between "Wick Rejection" for tighter zones or "Full Bar" for wider coverage.
• Show Invalidated Zones: Toggles the visibility of broken levels to view historical structure.

Sweep Detection

• Show Sweep Signals: Toggles the visual markers for detected sweeps.
• Highlight Sweep Bars: Highlights the specific bar where the sweep occurred.

Signal Quality Filters

• Trend Filter (EMA): Only shows bullish sweeps above the EMA and bearish sweeps below it.
• Volume Spike Filter: Requires the sweep bar to have higher-than-average volume.
• Wick Rejection Filter: Requires the sweep bar to have a specific wick-to-body ratio to ensure a strong rejection.

FAQ

How do I access Liquidity Sweep Detector?

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

What timeframes work best?

While it works on any timeframe, it is most effective on the 4H, Daily, and 1D charts where institutional footprints are most prominent.

Can I use this for automated alerts?

Yes, the script is optimized for alerts, allowing you to be notified the moment a sweep or zone break is detected.