You need to know what a LRLR is ❗

Summary

The video explores the concept of a low resistance liquidity run in trading. It breaks down key concepts like resistance, fair value gaps, and order blocks, highlighting how premium arrays act as resistance and how these can be overcome. Once resistance is cleared, price action accelerates as the market moves towards highs. This creates a low resistance liquidity run, where the lack of opposing forces allows for faster movement in the market, making it a crucial strategy for understanding price dynamics in trading.

Takeaways

• 😀 Resistance refers to areas where price struggles to move higher, while low resistance means there are fewer barriers left for price to rise.
• 😀 The 4-hour fair value gap (F Gap) is a key reference point for price action, providing areas where the price can continue higher.
• 😀 A move lower into the F Gap creates premium arrays, which are market levels where prices tend to reverse or consolidate.
• 😀 Premium arrays, including order blocks, represent higher price levels where resistance can be expected, while discount arrays represent lower price levels where price can move more freely.
• 😀 If higher prices are expected, discount arrays tend to hold, while premium arrays act as opposing resistance levels.
• 😀 Once the resistance (premium arrays) is cleared, the market is left with only swing highs as resistance, making price action more likely to move fast.
• 😀 The liquidity run happens when the last premium array is cleared and all that remains are the highs.
• 😀 After taking out the last order block, price runs faster because there is no significant resistance left, only the swing highs.
• 😀 Low resistance liquidity runs are characterized by rapid price movements due to the absence of resistance zones.
• 😀 The presence of both rejections at lower levels and clear breaks above premium arrays indicates the market is ready for a liquidity run.

Q & A

What is meant by 'resistance' in the context of this script?

Resistance refers to levels in price action where the market tends to face difficulty moving higher, as selling pressure exists. In the context of the script, it represents areas that could stop or slow down an upward price movement.

What does 'low resistance liquidity run' refer to?

A low resistance liquidity run occurs when there is little to no resistance left in the market, except for swing highs. This leads to a fast price movement, as there are fewer barriers to stop it from continuing in a particular direction.

What is a '4-hour V gap'?

The 4-hour V gap refers to a price gap observed on a 4-hour chart, typically formed when there is a significant price movement without much trading in between, creating a V-shaped pattern.

What are 'premium arrays' and how do they relate to resistance?

Premium arrays are price levels where the market has overextended to higher price points, leading to resistance. These levels are expected to act as resistance when prices reach them again, as they contain premium orders placed at higher prices.

What is the significance of a 'fair value gap' in this context?

A fair value gap represents an area where price has moved quickly, leaving a gap between the current price and where it should have been trading based on its value. This gap can be seen as a potential area for price to return to, filling the void left by the gap.

What is an 'order block' and why is it important here?

An order block is a zone where institutional buyers or sellers have placed large orders in the past. In the context of this script, order blocks are important as they indicate areas where price may find support or resistance, depending on whether the price is moving up or down.

How does the script describe the movement after resistance is cleared?

After the resistance is cleared, the script describes price action moving higher with fewer obstacles in its path. Once the premium arrays are removed, only the highs remain, signaling a fast-moving price action.

What does 'discount arrays' mean in this context?

Discount arrays refer to price areas where prices are relatively lower, offering a potential buying opportunity. These areas are considered discounts compared to higher price levels or premium arrays.

What role do 'swing highs' play in the liquidity run?

Swing highs are the final points of resistance left in the market before a low resistance liquidity run begins. Once these swing highs are broken, the price tends to move rapidly as there are no significant obstacles left.

Why does the script suggest that price action will happen very fast after the last resistance is cleared?

The script suggests that price action will happen very fast because, after clearing the resistance levels (such as the premium arrays and order blocks), the only remaining barrier is the swing highs. Once those are breached, the market has low resistance, allowing for rapid price movement.