Liquidity Sweep

A Liquidity Sweep is a rapid price movement that breaches an obvious level where retail stops are clustered, swing highs, swing lows, equal highs, equal lows, or round numbers, and immediately reverses. The thesis is that institutions need liquidity to fill large orders and deliberately drive price into these zones to absorb opposing positions before committing to the real directional move.

The sweep's signature is speed: price breaches the level, holds briefly, and returns through it within one or two candles. This distinguishes a sweep from a genuine breakout (which typically holds and continues). Sweeps are most reliable during kill zones (London/NY opens) when session-opening flow dominates. Trading the sweep means entering against the initial breach direction once price returns through the swept level, with stops just beyond the sweep extreme.