Liquidity-Finder ICT / SMC

The Liquidity-Finder ICT / SMC indicator identifies and tracks liquidity levels based on pivot highs and lows to help traders visualize potential market sweeps and institutional stop hunts. By differentiating between active (open) liquidity and neutralized (liquidated) levels, it provides a clear view of market areas where significant order flow may reside.

Usage

This tool is designed for practitioners of Inner Circle Trader (ICT) and Smart Money Concepts (SMC). Use the solid lines to identify active liquidity zones where price may gravitate. When price breaches these levels, the indicator transforms the solid lines into dashed lines to represent liquidated zones.

• Liquidity Sweeps: Use the "Dipped" signals (circles) to identify instances where price has momentarily breached a level but failed to close beyond it, often indicating a liquidity grab.
• Entry Signals: Labels appear when price closes on the opposite side of a recently swept liquidity level, suggesting a potential shift in momentum or a successful stop hunt.
• Filtering: Adjust the "Left" and "Right" candle settings to change the sensitivity of pivot detection, allowing for the identification of either minor internal liquidity or major swing points.

Details

The script utilizes pivot logic to establish horizontal liquidity levels. A level is considered "Open" as long as price has not interacted with it. Once the high (for bearish liquidity) or low (for bullish liquidity) touches the level, it is marked as swept.

Key internal logic includes:

• Liquidated Lines: When a level is breached, the script replaces the infinite extension with a fixed-length dashed line at the point of liquidation.
• Entry Logic: An entry signal is generated if the price closes above/below a swept level within a specific candle lookback window (Max Candles) and satisfies a minimum length requirement.

Settings

Candles

• Left: The number of bars to the left of a pivot to confirm a liquidity level.
• Right: The number of bars to the right of a pivot to confirm a liquidity level.

Signals

• Min Line-Length: The minimum distance required for a liquidity level to be valid for an entry signal.
• Max Candles: The maximum number of bars after a sweep during which an entry signal can remain valid.

Display

• Line width Open: Sets the thickness of active liquidity lines.
• Line width Closed: Sets the thickness of liquidated liquidity lines.
• Show liquidated lines: Toggles the visibility of dashed lines representing historical sweeps.
• Show Dips: Toggles the circle markers that indicate price just "dipping" into liquidity.
• Show Signals Labels: Toggles the visibility of "Buy" and "Sell" entry labels.
• Color Buy/Sell: Customizes the colors for bullish and bearish liquidity elements.

Alerts

• Liquidated: Alerts when a liquidity level is fully swept.
• Just Dipped: Alerts when price touches a level but has not necessarily closed beyond it.
• Entry: Alerts when the specific entry criteria (reversal close) are met.

FAQ

How do I interpret dashed vs. solid lines?

Solid lines represent "Open" liquidity that hasn't been touched yet, acting as potential targets or reversal zones. Dashed lines represent "Liquidated" levels where a sweep has already occurred.

What do the "Buy" and "Sell" labels signify?

These labels indicate a potential entry signal following a liquidity sweep, specifically when price closes back across the level within the defined lookback period.

How can I access the Liquidity-Finder ICT / SMC?

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