ICT Turtle Soup (Liquidity Reversal)

The ICT Turtle Soup (Liquidity Reversal) indicator identifies classic liquidity-based reversal patterns by detecting price runs above or below recent swing levels that fail to hold.

Usage

The Usage section describes how the script can be used to identify high-probability reversal zones based on liquidity grabs.

• Bullish Setup: A bullish signal is triggered when price drops below a recent swing low to sweep liquidity but subsequently closes back above that level, indicating a potential "Turtle Soup" reversal.
• Bearish Setup: A bearish signal is triggered when price rallies above a recent swing high to grab buy-side liquidity but closes back below it, suggesting a potential trap and downward reversal.
• Intraday Trading: This tool is most effective on lower timeframes such as the 5m or 15m charts, where liquidity sweeps at swing points are more frequent.
• Confirmations: Users should look for these signals near key higher-timeframe levels, or combine them with other concepts like Fair Value Gaps (FVG) or Order Blocks for increased confluence.

Details

The script functions by identifying swing highs and lows based on a user-defined lookback period. Once a swing point is established, the indicator monitors subsequent price action. If price pierces the swing point's extreme without sustaining a close beyond it, the "Turtle Soup" logic is validated. This concept is rooted in the idea that institutional "Smart Money" often seeks liquidity at obvious swing points where retail stop-loss orders are likely clustered before moving price in the opposite direction.

Settings

• Swing Lookback: Determines the number of bars used to identify the swing highs and lows that define the liquidity zones.
• Show Labels: Toggles the visibility of descriptive text labels for detected signals.
• Label Size: Adjusts the font size of the chart labels (tiny, small, normal, large, huge).
• Bullish Turtle Soup Color: Sets the color for bullish reversal shapes and labels.
• Bearish Turtle Soup Color: Sets the color for bearish reversal shapes and labels.

FAQ

What does the "Swing Lookback" setting do?

The Swing Lookback defines how many bars must be on either side of a high or low for it to be considered a valid swing point. A higher value will identify more significant, longer-term liquidity levels.

Can I use this for automated alerts?

Yes, the script includes built-in alert conditions for both bullish and bearish Turtle Soup signals that can be configured to notify you in real-time.

How do I get access to ICT Turtle Soup (Liquidity Reversal)?

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