Sweep Reversal 5M PRO

The Sweep Reversal 5M PRO indicator identifies high-probability institutional sweeps using Swing Failure Patterns (SFP) combined with volume confirmation and Smart Money Concepts (SMC) filters.

Usage

The Sweep Reversal 5M PRO is designed to detect liquidity grabs where price briefly pierces a significant swing high or low before reversing.

• Long Signals: Look for "BUY" labels which appear when a bullish SFP is detected and confirmed by a momentum candle with increasing volume.
• Short Signals: Look for "SELL" labels which appear when a bearish SFP occurs at a swing high, followed by a bearish candle with volume confirmation.
• Risk Management: Traders typically place a tight stop-loss just beyond the wick of the sweep candle. A minimum risk-to-reward ratio of 1:1 is recommended, with 2:1 being ideal for these setups.

While optimized for the 5-minute timeframe (5M), the logic can be applied to other intraday charts where institutional liquidity sweeps are prevalent.

Details

The script utilizes pivot analysis to identify swing points over a user-defined lookback period. A Swing Failure Pattern (SFP) is identified when the price creates a new high/low relative to these pivots but fails to close beyond them, indicating a "sweep" of liquidity.

To ensure signal quality, the tool incorporates several filters:

• Volume Confirmation: The reversal candle must show higher relative volume than the previous bar.
• Candle Body Filter: Doji candles are ignored to ensure the reversal has sufficient momentum (the body must represent at least 40% of the total candle range).
• Cooldown Period: A mandatory interval between signals to prevent over-trading in choppy market conditions.

Settings

• Left Bars for Swing: The number of bars to the left required to identify a pivot high or low.
• Right Bars for Swing: The number of bars to the right required to confirm a pivot high or low.
• Cooldown Period: The minimum number of bars that must pass before a new signal can be generated after a previous one.

FAQ

How do I access Sweep Reversal 5M PRO? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.

Does this indicator repaint? No, the Sweep Reversal 5M PRO is designed to confirm signals based on closed bar criteria and does not repaint.

Which assets work best with this tool? The script is most effective on highly liquid assets such as Major FX pairs, Gold, and Indices where institutional SFP setups frequently occur.