if you understand the difference between

a sweep of liquidity versus a run on

liquidity you will have an extremely

Advanced understanding of trading now

I'm going to guide you from A to Z here

so let's dissect everything let's start

off with what is a sweep and what is a

run on liquidity now in both scenarios

let's use a bullish example where we

trade above a swing high and how we

react Above That Swing high will tell us

if it's a sweep or a run on liquidity

where if we sweep a swing high that

means we are trading Above That Swing

high and then usually we immediately

retrace back lower to then Target the

opposing liquidity where we will

actually turn from bullish to then all

of a sudden bearish where if it's a run

on liquidity we will continue in the

intended Direction when we trade Above

That Swing High meaning once we trade

Above That Swing High we do not all of a

sudden continue lower no we actually

continue higher targeting a higher swing

high or another premium array now

usually this is very well seen in

hindsight I think everyone can see it in

hindsight but we are trying to see how

we can spot it in real time how we can

anticipate it that is where we need the

following understanding so I'm going to

remind ourselves of what we went over in

old videos as well how the market moves

the market does one of two things at any

given time it is either offering fair

value or it is seeking liquidity well

when we continue higher in the market we

create buyid right there there is buyers

getting involved now after we make a

retracement we get sell s side right

there also getting involved so buyers

and sellers right here have a fair

chance to get involved before we

actually move higher so what do the

market doing at that moment in time well

it is allowing Sellers as well to get a

fair chance to get involved it's

offering fair value then once we move

higher and this is the swing high right

there that we talked about in the first

example then if we now want to continue

higher right here we have offered fair

value right there so right now the only

area where we have not offered fair

value just yet is above that swing high

right there because this area right here

is only where buyers again got a fair

chance to get involved so how far can

price actually retrace well Tor the fair

value area that we have right there

because if we are offering Fair value

then the only place where we can now

offer fair value is the place where we

have not offered fair value just yet

stick with me it's going to make a lot

of sense where the gray area right there

is the only area we can currently

retrace to to then still continue higher

off of that because that area is where

price can now offer fair value to still

continue higher this fair value area is

also what you may know as mitigation

block an order block and a breaker block

but what if we are not offering that

fair value and you can probably see when

we are offering that fair value right

here we can continue higher in other

words we can run that liquidity to

continue higher as well that is when we

are offering fair value but what if

something like this happens we have fair

value area right there and we are coming

back into this gray box quite deep right

there well the only place where we could

have offered fair value was again above

that high right here there is no reason

to retrace very far at that moment time

because we have already offered fair

value and how the market moves is again

one of two things it's either offering

fair value or it's seeking liquidity so

if it's not offering fair value at that

moment in time then what is it doing

it's seeking liquidity seeking liquidity

in the form of what in the form of this

swing low right there that we left

behind so that means that we have a

sweep of liquidity to actually continue

lower instead now when I talk about

liquidity it's always going to be a

swing high or a swing low so if we are

seeking liquidity it's a swing high or a

swing low those are your liquidity

points so let's look at them side by

side before we move to real chart

examples right here this again that

seeking liquidity and this is that

offering fair value the first one

seeking liquidity is again that sweep of

liquidity as well where this is the

offering fair value is associated with

that run on liquidity here we are on gup

us on the 4-Hour time frame the higher

time frame premise is to already

continue lower so I'm already looking at

lower prices actually so that's quite

important to understand so we won't go

over the higher time frame fully in dep

right now if we take a look at this

right here we can see we have this move

lower right there after that move lower

we have a move higher sitting right

there then we have a move lower again

again below this low sitting right there

that swing low this creates that same

fair value area that we discussed a

little bit earlier sitting right there

and why do I Mark out the bodies and not

the wick that is because this in itself

is now a breaker block as well it's that

three swing movement of that fair value

area which is seen a little bit

different 1 2 3 is your typical one

order block and mitigation block is this

one then the second one the second

variant is this right here and that

creates your breaker block right there

and the reason I Mark out the body and

not the wick is because the wick the

lowest point of that Wick is not

overlapping with a fair value Gap so

that's exactly why I Mark out the body

now that body is where we can now

retrace back into to continue lower from

because that is the fair value area if

we are offering fair value we should

already continue lower right there and

we can see that we have a sting into it

right there to then continue lower

towards this swing low right here this

is where it becomes very important

because right here if we want to

continue lower we should ideally be

running lows because running lows again

means that we will continue in that

direction whilst if we are sweeping lows

we might get an opposite move so then

how do we now determine if this move

below that low right there is actually a

sweep or a run on liquidity once we take

out a certain liquidity point we need to

ask ourselves where is again that fair

value area so here we are on the 1 hour

going down a singer time frame to go

into more detail this right there is

again that fair value area right now so

if we want to continue lower then this

fair value area is what we can continue

lower from any retracement above that is

quite suspicious we should not have to

do that so if we retrace very deep into

that gray area it becomes more of a

potential sweep of liquidity not going

confirmed just yet the first sign that

we often times have is when we take out

the liquidity point if it's a sweep of

liquidity we will not have a fair value

Gap exactly overlapping with the

liquidity point that we just took so for

example right here we on the 1 hour time

frame take out that swing low liquidity

point we do not create a fair value Gap

exactly overlapping with this low right

there there the first sign if we run

liquidity then as a general rule thumb

we do create a fair value Gap exactly

overlapping with that low it's the again

the first sign for a run versus a sweep

on liquidity when we have a run on

liquidity we do create a fair value Gap

exactly overlapping with the load it's a

general rule of thumb on what creates

the difference between a sweep versus a

run Equity but that's not the only part

because like we saw in the 4 Hour with

that earlier fair value area that we

have right here that breaker that we

talked about then we see we also do not

have Fair valum exactly overlapping with

this low right there so what is then

another sign well another sign is again

that offering fair value and that

seeking liquidity like we talked about

as well but to understand the third sign

we need to dive deeper into what it

actually means to seek liquidity and why

it happens in the market so the theory

that I like to use right here is if we

are seeking liquidity and how is that

going to be done whose liquidity are we

actually looking for well we are looking

for liquidity that has an impact on the

market that's actually a lot of

liquidity so we're not necessarily

looking at liquidity from your neighbor

job doesn't really matter those two lots

with all due respect they don't really

matter in the big scheme of things but

if we talk about certain financial

institutions bigger hedge funds then

that does matter because let's say one

big hedge fund or one Central Bank even

is trying to get involved in the market

trying to do a transaction then there's

a limited amount of orders that we can

have in the market so we need to free up

some kind of orders to actually look to

get involved ourselves and when I say

ourselves I'm not referring to me my

liquidity also is extremely irrelevant

but I'm referring to central banks

bigger financial institutions if they

want to get involved then they can't

just simply click buy or sell at any

given moment in time no they need to

free out liquidity to actually get

involved to a counterparty what does

that mean well if we are looking to sell

there needs to be an opposing buyer to

our sell order if we are trying to buy a

car someone needs to sell us that car if

we want to sell that car someone needs

to buy that car off of us we can't just

sell and buy through thin air that's the

same exact thing in the market with

orders so if the theory is correct and

the bigger Market maker right there has

a plan in mind on getting involved then

what does that actually look like well

let's say the market maker wants to buy

right here how would he go about that

well what kind of people are working

usually at financial institutions on a

very general rule thumb Trend Traders

Trend Traders like to buy on breakouts

very easy just buy on the breakout right

there to then place the stop loss above

recent swing highs to then continue

lower off of that now let's say the

other counter party is trying to get

involved right there in buys then what

does that look like well that looks

something like the following because now

we have sells right there the breakout

Traders match with buy orders right

there as well where that can even Target

the swing high right there whatever they

are looking to Target now let's say the

opposing part that needed that liquidity

of those breakout Traders is trying to

get involved on those buys right there

we now have sellers to our buys right

there for Central Bank where they can

now look to Target those swing highs

sitting right there but now it gets

important because if this position right

there the buy position wants to hit

takeprofit then they are going to sell

at that takeprofit level in other words

they need a buyer an opposing buyer to

sell to at that takeprofit level who can

they sell to well by coincidence we

already have someone trapped perfect

let's use them as well to our advantage

to sell to so not only to buy from but

also to then sell to again where we are

buying from them at our entry and their

entry level right there the breakout

Traders and we sell to them at the

takeprofit level right there what does

that mean and why is that important well

if we are seeking liquidity in the form

of this high right there and we are not

offering that fair value anymore and we

are aiming for that high that means that

this right here the people that are

getting trapped should should not be

freed of that position as in they should

be trapped where let's take this same

example right here when we run this low

we do not have a fair value of

overlapping but can you see the

difference when we trade below this low

and this low right there below this low

we are comfortable below this low we are

not comfortable and we are immediately

trying to seek that opposing liquidity

why because we need that liquidity

otherwise we don't have have a take

profit so that means that this position

those breakout Tres that are trapped

cannot be released they need to stay

trapped until we reach that takeprofit

level right there if we do release them

for example right here we could argue at

that moment in time we might also trap

breakout Traders right there but we can

see we do not have an opposing

aggressive move towards the highs what

that exact opposing aggressive move is

is something I'm also going to explain

of course which means that right there

at this moment in time if they worry

about their position they can go out of

Break Even they might eliminate that

full position they can get out of the

trade we do not want them to get out of

the trade unless their stop- loss gets

hit right there if they are comfortable

and they can get out of the trade at any

given moment in time we are likely

running the lws if they are not

comfortable and we are trapping them

meaning we aggressively move towards the

other side that's exactly when we are

trapping them and and when we need their

stop loss for the take profit so again

let's retrace those steps right here to

how we can know how we can then Target

that liquidity and we are not running

that low to immediately already continue

lower so how can we know that this fair

value Gap is not very likely to hold

that is based on We are failing to

create a fair value Gap exactly

overlapping with the lows right there

that indicates that we have somewhat of

a lack of intention right there but

that's not the only sign because then we

have the fair value area sitting right

there so we are likely not going to

retrace very deep into it so retrace

into that fair value Gap it's already a

little bit suspicious but then that's

not the only part because then the third

part comes in where we need to trap

those breakout Traders below that low

sitting right there how do we trap them

with opposing intention what is

intention fair value gaps and you can

already see me smiling because fair

value gaps tell you again everything and

that's why I personally my whole trading

plan is based on Fair Value gaps so all

I do is indeed talk about fair value

gaps with of course other Concepts in

combination with at the core it's always

fair value gaps so what do we see well

that intention if we are trapping people

should be bullish right there and what

do we see we get a bullish fair value

Gap right there after sweeping this 4H

hour swing low and that right there for

me confirms The Sweep of liquidity to

then Target this swing high right there

so actually I do not see that fair value

Gap right there as something we can

continue lower off of no I see it as

resistance yes as in we might get a

retracement off of that but I do not

expect lower prices off of that I'm

actually looking at higher prices at

that moment in time and the earliest

sign where I did not want to look at

shorts anymore was when when we filled

to close with a fair value Gap exactly

overlapping below that low that's

exactly the moment when you should

become suspicious so remember the

previous video actually where we went

over how far price can retrace with the

third candle the fair value Gap where

you would require more confirmation this

is exactly if we still want to continue

lower you should require more

confirmation of price I mainly look at

that from the same time frame the swing

high is actually on or a time frame

below it

so in this case you can see I'm

switching back and forth between the 4

Hour and the 1 hour so 4our swing High 1

hour sweep 1 hour fair value gaps Etc to

confirm if we actually want to continue

higher 1 hour fair value area as well so

right now the fair value area is this

area right there which we just created

so if we now want to continue higher we

can continue higher off of that we also

see an order block sitting right there

as well so I'm going to Mark out the

fair value area a little bit bit higher

right there because that or block the

wick is exactly overlapping with a fair

value Gap as well then we can see at

this moment in time let's replay this

actually we can see at this moment in

time we might create a fair value Gap

exactly overlapping with that high so

that is quite bullish that's a good

understanding that we might actually

want to continue higher so let's wait a

bit and afterwards we see right here

that we do not create that fair Val

exactly overlapping with that high

anymore okay a little bit suspicious but

at that moment in time do we just switch

bearish and right now I forecast it to

you that we will continue lower no of

course not this is all

probabilities where if we now want to

continue lower and we want to Target

this low right there because that's the

get again the fair value area low right

now that is the seeking liquidity low

then we have this whole move potentially

to get involved so why get involved as

early as possible right there and try to

call a top in the market that doesn't

make sense because at this moment in

time all we are dealing with right there

is bullish price action but can you also

remember we went over as well in

previous videos arguments we had good

arguments right here to continue higher

to create a bullish Fair Val up

overlapping with that swing high right

there as soon as we take that away we

Now fail to create that what is a

characteristic of a sweep of liquidity a

fair value Gap not overlapping with that

exact swing High

okay so that creates a bearish argument

right there does not mean that we are

all of a sudden bearish because at that

moment time we are still more bullish

than we are bearish just if you want to

look at higher prices wait for more

confirmation there's no shame in waiting

for another fair value higher right

there to actually confirm that we are

now again comfortable remind yourself of

that trap of liquidity comfortable above

that high to then look for higher prices

instead you do not need to be the first

one to get involved absolutely not but

where you can look to get involved is

right now we can say we are not offering

that fair value anymore right there we

have a very deep retracement into that

we create a bearish fair value Gap as

well right there so we are trapping

people so right here what do we see we

have this one hour F Val actually right

there which we can potentially continue

lower from that is where we confirm the

sweep of liquidity to continue lower off

of the

is that 100% probability absolutely not

therefore I get my feel right there so

we have to also understand how we react

inside that fair value Gap right there

where inside a fair value Gap you

actually want to do the same exact thing

let me show you here we are on Euro here

we are on Euro US Dollar on the 4H hour

time frame as well and we can actually

see this fair value area right there

which we retrace back into we are

comfortable below the low we took right

there as well we can continue lower off

that fair value area right there we have

offered fair value right now whilst

offering that fair value we create this

4our fair value Gap right there so

similar on gpus dollar how do we now

confirm this 4our fair value Gap well

what creates the low of a 4H hour

bearish fair value Gap right here or any

bearish fair value Gap the low is

created by the third candle the third

candle High to be specific right there

that third candle high is what that is a

swing high on the lower time frame so if

you struggle with understanding if a

fair Val will actually hold this

understanding helps you in that why so

looking at this gray box right there

that's the 4-Hour fair value Gap now on

the lower time frame the low of that

4-Hour fair value Gap the third candle

High actually is a lower time frame

swing High the way I like to confirm my

PD race is if it's a 4-Hour PD r I look

at either a 15minute sharp turn or I

look at 5 Minute two lags lower so what

is the 15-minute sharp turn well if we

struggle with confirming that 4our

fortive right there we can also look at

it through this lens let's again remind

ourselves of those breakout Traders

right there those breakout Traders and

we also have this fair value area

sitting right there we can see we are

not comfortable above that high right

there and we are also not offering fair

value anymore to actually continue

higher off of that we have intention

going lower where people are getting

trapped and that exactly creates a sharp

turn that's so important to understand

the way people get trapped is by fair

value gaps as well because fair value

gaps also show you fake intention a fair

value Gap in itself shows you intention

because it's simply fast price action an

aggressive move is fair value gaps so if

you want to fake people into the Market

you want to have a fake out then you use

fair value gaps where here we create

fair value gaps going above that high

showing intention at that moment in time

breakout Traders might be getting very

excited and might think oh this

definitely wants to continue higher

right there whilst we are running into a

4H hour fair value Gap and we are now

using the swing High because we are

looking at that sweep of liquidity it

might help you to understand when we

actually want to trade lower off of a

fair value Gap as well then right here

we do not have an overlapping fair value

Gap exactly with the high that we just

took and then right there we see an

opposing fair value Gap in the making

which is in turn a sharp turn when you

have a bullish fair value Gap right

there and a bearish fa value Gap going

against it but is that not a balanced

price range no because they don't have

to be overlapping fair value gaps a BPR

is a sharp turn correct but a sharp turn

doesn't have to be a BPR very important

important to understand as well because

these fair value gaps don't actually

have to be overlapping with one another

and once we have that sharp turn we are

not offering fair value we are

aggressively trapping those Traders

right there this is exactly when we can

look to trade off of even that first

fair value Gap already covering the

bodies right there and you can get even

more specific with your stoploss right

now because it all connects together

where if we are trapping those Traders

right there above that line then what

should we do we should not release those

Traders until we reach that opposing

liquidity right there meaning we should

not trade above that line right there

and if we do then we might actually want

to continue higher instead so our stop-

loss can be at that high right there

because we should ideally not trade

above that high anymore we should not

get comfortable above that high anymore

where sometimes you might still see some

Wicks coming above

Wix is again we can argue about that

because Wix is universally not agreed

across all Brokers so it does not mean

that price was actually traded right

there so that is why often times you'll

hear people refer to as well bodies tell

the story so if we trade back Above This

level with a body right there then that

tells us okay that is where the major

liquidity was so that is most likely

universally agreed on every single Forex

broker that we did trade back above that

high where Wix can also be manipulation

on the broker its side by the way if

you're wondering how that then works on

Inus Inus if you're training the CME

Group it's a whole different story

because that is the price action that's

the real price action right there where

Forex you don't have the exact real

price action on Euro US dollar right

there so targeting a swing low I

personally like to Target one to two so

I would have my target right there

personally then continue lower off of

that right there make sure you take into

account spread of course as well at your

stop loss otherwise you might have

gotten taken out right there before we

actually continue lower so remember

candle signs previous candle High pruse

scandle low is what on the lower time

frame swing high and swing low liquidity

points so let's look at Russell right

here when we take out that high right

there at first I was potentially looking

at a sweep of liquidity right there I at

least want more confirmation if we still

wanted to continue higher because we

have a first sign right there that

actually might be a sweep now to give

you a well of course an example on the

run on liquidity right here we have this

daily fair value Gap right there which

on the 4 Hour is also overlapping with

4our fair value area right there that is

why I was expecting higher price off of

that 4our fair value area right there

for the mmt since this in itself is a

run on liquidity and not a sweep of

liquidity that is where we can look to

Target that high and at that high is

where we would do the exact same thing

over and over see if we sweep or run

that liquidity so back to Russell we see

right there we are now having a

potential sweep of That Swing high right

there but nothing confirmed just yet

because if we still want to continue

higher we also have this order block

that resistance going against us right

there now the way candle science works

is that if we come into a discount array

in this case on the weekly time frame we

do not necessarily have to continue

higher immediately on the first candle

we can still sweep the previous candle

low right there to continue higher off

of that how do we know if we are

sweeping that previous candle low right

there let's look at the daily so on The

Daily we could argue that we might have

a confirmed sweep at that moment in time

looking to continue lower the only thing

is is that we are running into

resistance on the weekly so we have to

take that into account where right here

what do we actually see we see we have

this swing low right now on the daily

time frame which is the previous candle

low on a weekly time frame so a failure

to close below previous candle lows is

actually a sweep on the time frames

below that and a failure to close above

previous candle highs is most likely

going to be a sweep on the time frame

below that again so right here what I

mean by that we fail to close below that

low right there then on the daily what

we see is that is actually a sweep also

a failure to close right there below

that swing low sweeping it potentially

then on the 4 Hour let's look at that in

more detail we see that we have a

continuation lower right there this

again creates a sharp turn sitting right

there momentum going into it and

momentum right now going out of it right

there where again we have that offering

Fair Value Story that breakout story

right there and we see a new fair value

area right there with perfect exact

swing High overlapping with that R Gap

and that is exactly what we can now

continue higher from because this this

in itself is now the fair value area

sitting right there where what is now

the target opposing liquidity we sweep

liquidity and we tar the opposing

liquidity in the form of this swing high

right there that we encounter and of

course on the weekly that is opposing

liquidity it's even this swing high

sitting right there so if we now want to

deliver higher towards that Weekly swing

High then what can we see well here what

are we doing we are creating a fair

value Val area right there in a previous

fair value area that we saw towards the

left as well so this fair value area in

about 1 hour that candle will close so

that will tell us if we are overlapping

that exact high with that value Gap and

if that is the case that is exactly what

we can deliver higher from to then Reach

This high sitting right there I can

understand that this is quite a

difficult topic and it's extremely

Advanced so again take your time to

understand this because it will pay off

a lot trade in line with the higher time

frame premise the reason why this right

here is not actually a run on liquidity

why we still continue higher yes we can

see it based on the overall

understanding of what we just went over

but it's also against the higher time

frame premise which we have talked about

on the weekly right there understand

where the higher time frame wants to go

then understand where the lower time

frame fair value areas are if we are

running highs if we are sweeping those

highs based on that wait for more

confirmation based on that potentially

trade The Sweep as well and practice

practice practice and go see it for

yourself combine this video with the

video the third candle tells you

everything that will also make a lot

more sense off of which Fair valap we

can actually look to continue higher as

well on why sometimes the F will not

hold and we can already see that using

the concepts here but also the third

candle tells us that already then really

quick as well before you go since we

have hit 100K subscribers on YouTube and

the mmt is actually one years old we are

going to give away with funded friends

my upcoming prop firm 100K account and

we are also giving away a oneyear

subscription for free of course towards

the lucky giveaway winner so details to

that as well are in the description it's

on Twitter and you can look to enter

right there then I wish you best of luck

and I want to thank you for everything

all right B thank you