How to trade Turtle Soups (Liquidity Sweeps)

Summary

This video script delves into the concept of 'liquidity sweep' or 'turtle soup' in trading, a strategy often misunderstood by traders. It explains the origins from the 'Turtle Traders' and their trend-following methods, highlighting the difference between a 'liquidity sweep' and a 'liquidity run'. The script teaches how to identify and trade these patterns, emphasizing the importance of understanding market liquidity, swing points, and the impact of large entities on price movements. It also introduces the idea of 'previous candle high and low' in the context of order flow and candle science, urging viewers to study these patterns through case studies for a deeper understanding.

Takeaways

• 📈 The concept of 'liquidity sweep' or 'turtle soup' is a trading strategy used to capitalize on market movements, particularly by trend traders known as 'Turtle Traders'.
• 📚 The origin of 'turtle soup' is explained in 'The Complete Turtle Trader' book, which is recommended for further reading on the subject.
• 🦆 Turtle Traders focus on trends and use breakout trading strategies, placing buy stops above recent highs and stop losses below recent lows.
• 🔄 A liquidity sweep occurs when the market trades above a high but then immediately reverses direction, causing a drawdown for breakout traders who placed their stop losses below the recent low.
• 🏁 The difference between a 'liquidity sweep' and a 'liquidity run' is based on whether the market continues in the same direction after trading above a swing high or low.
• 💧 'Liquidity' in trading refers to swing points, which are areas of the market where there is significant buying or selling interest.
• 🔄 Understanding the market's comfort above a high or below a low is crucial for identifying potential liquidity sweeps and runs.
• 🚀 Large entities in the market require sufficient opposing liquidity to execute their large orders, which can lead to liquidity sweeps when they take profits or stop losses are triggered.
• 📊 The script emphasizes the importance of analyzing higher time frames for identifying significant trends and potential liquidity events.
• 🕊️ 'Candle science sweeps' are similar to order flow sweeps but observed on different time frames, highlighting the fractal nature of market movements.
• 📝 The script encourages traders to conduct case studies on order flow sweeps in trends and candle science sweeps to better understand and identify these patterns.

Q & A

What is the concept of 'liquidity sweep' or 'turtle soup' in trading?

The 'liquidity sweep' or 'turtle soup' refers to a trading scenario where a market breaks a trend line, often a high, but instead of continuing in the direction of the breakout, it reverses immediately, causing a stop-loss trigger for trend-following traders, leading to a rapid move in the opposite direction.

What is the origin of the term 'turtle soup'?

The term 'turtle soup' originates from 'Turtle Traders,' who are known for trend-following strategies. When these traders are taken out of the market due to a false breakout, it is metaphorically referred to as making 'turtle soup.'

Why are Turtle Traders susceptible to 'turtle soup' scenarios?

Turtle Traders are susceptible to 'turtle soup' because they use breakout trading strategies, placing buy stops above recent highs and stop-losses below recent lows. When the market breaks above a high but then reverses, it can quickly trigger their stop-losses, causing a short-term price drop.

What is the difference between a 'liquidity sweep' and a 'liquidity run'?

A 'liquidity sweep' occurs when the market trades above a swing high or below a swing low and then immediately reverses direction. A 'liquidity run', on the other hand, is when the market continues in the same direction after trading above a swing high or below a swing low, indicating a strong trend continuation.

How do large entities in the market use 'liquidity sweeps' to their advantage?

Large entities use 'liquidity sweeps' by placing large orders that require significant opposing liquidity. When breakout traders enter the market with buy stops, these large entities can sell to them, anticipating a sweep that will trigger the traders' stop-losses, allowing the large entities to take profits.

What is the significance of 'swing points' in the context of 'liquidity sweeps'?

Swing points, which include swing highs and swing lows, are significant in 'liquidity sweeps' because they represent potential reversal points in the market. Traders often place their stop-losses near these points, making them key levels for potential sweeps.

How can understanding 'liquidity sweeps' improve a trader's strategy?

Understanding 'liquidity sweeps' can help a trader anticipate potential market reversals following a breakout. This knowledge can be used to adjust entry and exit strategies, manage risk more effectively, and potentially capitalize on the rapid price movements that occur during a sweep.

What is the role of 'previous candle high' and 'previous candle low' in candle science?

In candle science, the 'previous candle high' and 'previous candle low' are used to identify potential areas of price rejection or continuation. These levels can indicate where the market may find support or resistance, which can be crucial for understanding the direction of future price movements.

How can a trader identify an 'order flow sweep'?

An 'order flow sweep' can be identified when the market creates a fair value gap or area but fails to continue in the expected direction, leaving behind a swing low or high. Traders can then look for a subsequent move that 'sweeps' through this level, indicating a potential reversal.

What is the importance of 'fair value gaps' and 'fair value areas' in trading?

Fair value gaps and areas are important in trading as they represent significant price levels where the market may find support or resistance. Once these levels are traded into, they can be used as reference points for future price action, including potential sweeps or runs.

How can a trader differentiate between a 'liquidity sweep' and a 'liquidity run' using technical analysis?

A trader can differentiate between a 'liquidity sweep' and a 'liquidity run' by observing the market's behavior after trading through a swing high or low. A 'sweep' will show immediate price reversal, while a 'run' will show continued movement in the direction of the trend.

Outlines

00:00

📈 Understanding Liquidity Sweeps and Turtle Soup

The script introduces the concept of liquidity sweeps, also known as turtle soup, which are trading strategies based on the behavior of trend traders, specifically the Turtle Traders. It explains the origin of the term, which comes from the trend traders' tendency to get taken out of the market, and how they operate by focusing on trends and breakout trading. The explanation includes the use of buy stop orders above highs and placing stop-loss orders below recent lows. The paragraph also describes how a liquidity sweep differs from a liquidity run and the importance of swing points in identifying liquidity.

05:00

💼 Market Liquidity and the Role of Large Entities

This paragraph delves into the necessity of market liquidity for large entities to execute their significant orders. It discusses the concept of a market needing both buyers and sellers, and how large entities require sufficient opposing liquidity to execute their trades. The script uses the example of breakout traders and hedge funds, who assume the market will continue in a certain direction after breaking a swing high or low. It explains how these entities use stop-loss orders as sell orders and how large entities can take profit from these, creating a liquidity sweep. The paragraph emphasizes the speed of these sweeps and the importance of understanding the difference between a sweep and a run in the context of market liquidity.

10:00

🕵️‍♂️ Analyzing Liquidity Sweeps and Runs Through Technical Analysis

The script continues with a deeper analysis of liquidity sweeps and runs, focusing on the technical analysis perspective. It explains the importance of being comfortable above a high or below a low and the implications for large entities in the market. The paragraph discusses how large entities can use the stop-loss orders of breakout traders to their advantage, targeting the most recent swing highs or lows for their take-profit orders. It also touches on the concept of fair value gaps and how they can be used to identify potential sweeps or runs in the market, emphasizing the importance of removing fair value gaps from charts once they have been traded into for better trading accuracy.

15:03

🔍 The Interplay of Order Flow and Candle Science in Liquidity Sweeps

This paragraph explores the relationship between order flow and candle science in the context of liquidity sweeps. It explains how a fair value gap or area can lead to a sweep if the market fails to create a new gap or area after a rejection. The script discusses the concept of respect candles and how they can indicate potential sweeps based on wicks below a swing low or high. It also introduces the idea of previous candle high and low (PCH and PCL) and their role in sweeps, illustrating how these can be used to continue a trend in a different time frame. The paragraph concludes by emphasizing the importance of understanding these concepts for effective trading.

20:04

📚 Practical Application of Liquidity Sweeps in Trading

The final paragraph provides actionable advice for traders looking to apply the concepts of liquidity sweeps in their trading strategies. It suggests conducting case studies on order flow sweeps in trends and candle science sweeps to identify patterns and improve understanding. The script encourages traders to mark these patterns on their charts and to use the provided link in the description to access a free study tool. The paragraph concludes by highlighting the importance of this knowledge in building a robust trading strategy.

Keywords

💡Liquidity Sweep

Liquidity Sweep, also known as Turtle Soup, is a trading concept that refers to a situation where a market breaks out of a trend but then reverses direction quickly, causing stop-loss orders to be triggered and potentially leading to a rapid price movement in the opposite direction. In the video, it is explained as a strategy that large entities might use to capitalize on breakout traders' stop-loss orders, creating a quick and aggressive move against the trend.

💡Turtle Traders

Turtle Traders are a group of trend traders known for their disciplined approach to trading based on trend following strategies. The term originates from the book 'The Complete Turtle Trader' and is used in the video to describe traders who focus on trends and use breakout trading strategies, which can sometimes lead to them being caught in a liquidity sweep or 'turtle soup' scenario.

💡Breakout Trading

Breakout trading is a strategy where a trader enters a trade in anticipation of a continued move in the direction of a recent price breakout. In the video, it is mentioned that Turtle Traders use this strategy, placing buy stop orders above recent highs, expecting the price to continue rising and respecting the trend.

💡Stop-Loss

A stop-loss order is a tool used by traders to limit their loss on a trade. It is set at a certain price level, and when the market reaches that level, the order becomes a market order to sell or buy, closing the position. In the context of the video, the stop-loss is placed below recent lows for long positions, and its triggering can be part of the liquidity sweep dynamic.

💡Trend

A trend in trading refers to the general direction in which prices are moving. It can be upward (bullish) or downward (bearish). The video discusses how Turtle Traders focus on identifying and trading with the trend, using breakouts to enter positions expecting the trend to continue.

💡Swing High/Low

Swing highs and lows are points on a price chart that represent temporary resistance or support levels, respectively. In the video, swing points are discussed as areas of liquidity, which are significant for both breakout and sweep strategies, as they can act as levels where large entities might place orders to trigger stop-losses or continue the trend.

💡Fair Value Gap

A fair value gap is a concept that refers to a price area that the market is expected to reach based on the balance of supply and demand. In the video, it is mentioned that when the market trades back into a fair value gap or area, it can leave behind swing lows or highs that can be used for subsequent sweeps or runs.

💡Order Flow

Order flow in trading refers to the movement of prices as a result of the aggregate of all orders being executed in the market. The video discusses how understanding order flow can help identify potential liquidity sweeps and runs, as large entities may use the order flow to their advantage in executing their strategies.

💡Candle Science

Candle science is a term used in the video to describe the analysis of price action as depicted on candlestick charts, focusing on the formation of candles and the information they provide about market sentiment and potential future price movements. It is related to order flow and is used to identify potential sweeps or runs on different time frames.

💡Previous Candle High/Low

The previous candle high and low refer to the highest and lowest prices of the previous completed candlestick on a chart. In the video, these levels are discussed as potential areas for sweeps in candle science, where the market might trade below the previous candle low or above the previous candle high to continue in the direction of the trend.

💡Run on Liquidity

A run on liquidity is a term used in the video to describe a situation where the market continues in the direction of a trend after breaking a swing high or low, as opposed to a liquidity sweep where the market reverses quickly after the breakout. It is a scenario where large entities may continue to add to their positions, pushing the market further in the trend direction.

Highlights

The concept of 'liquidity sweep' or 'turtle soup' in trading is introduced, which is a strategy used when trend traders get taken out of the market.

Turtle Traders, known for trend trading, use breakout trading strategies, placing buy stops above highs and stop losses below recent lows.

A liquidity sweep occurs when the market trades above a high but immediately continues lower, causing a drawdown for breakout traders.

The difference between a 'liquidity sweep' and a 'liquidity run' is explained, with the former involving a trade above a high followed by a drop, and the latter continuing in the same direction.

Liquidity is defined as swing points, which are significant in the strategies of Turtle Traders and other trend traders.

An analogy is provided to explain the importance of liquidity for larger entities in the market, emphasizing the need for opposing orders for trade execution.

The video discusses how large entities can exploit breakout traders' strategies by selling to their buy stops and targeting their stop losses.

The concept of 'comfortable above a high or below a low' is introduced to understand market movements and the intentions of large entities.

The importance of time frames in identifying liquidity sweeps and runs, with higher time frames being more relevant for large entities.

The video explains how to identify aggressive moves by large entities through fair value gaps and expansion phase candles.

The role of previous candle high (PCH) and previous candle low (PCL) in identifying potential sweeps and runs in candle science.

The narrative of market defense lines is discussed, explaining how the last line of defense is the swing point without a fair value gap.

The difference between order flow sweeps and candle science sweeps is highlighted, showing how they are similar but seen through different time frames.

An order flow sweep is demonstrated, where a fair value gap or area is created but not followed by a new gap, leading to a sweep to a swing low.

Candle science sweeps are explained, where a previous candle low is used to continue a move higher, seen as a respect candle on the same time frame.

The video concludes with a call to action for viewers to study order flow sweeps in trends and candle science sweeps through case studies.

Transcripts

one of the most fancy Concepts in

trading is the liquidity sweep or the

turtle soup but you need to know how to

use it and where to look for it and that

is exactly what you are going to be

learning in this video so with video

number eight in the MMC series we are

going to go over liquidity sweep in

other words turtle soup now it surprises

me how many Traders are looking to trade

Turtle soups but they actually have no

clue what the origin story of a turtle

soup is the concept turtle soup is based

around Turtle Traders the cover that you

see on the right side is a book The

Complete Turtle Trader it's a good book

if you do want to give it a read and

turtle Traders are known as Trend

Traders and those Trend Traders

sometimes get taken out of the market

that is known as a turtle soup so these

Turtle Traders they focus on a trend now

a trend very simple looks something like

this and it continues higher respecting

the lows not coming below the lows right

there that is the perfect trending

conditions now Turtle Traders like we

mentioned are Trend Traders and they use

a form of breakout trading now what that

means is the following if we have

trending conditions and we trade above

high and we keep respecting lows since

we are trading above highs and we're

breaking through those highs right there

they use a strategy that capitalizes on

assuming that we want to continue higher

after taking out previous highs right

there and that the trend will continue

respecting lows and breaking above those

highs now when they place an order in

the market and they use that breakout

strategy they place a buy stop above the

high sitting right there assuming that

it wants to continue higher a buy stop

is when we trade above a certain level

your order gets filled when the buy stop

is located there where do they Place

their stop- loss they Place their stop

loss below the recent lows below the

recent swing lows now a lot of the time

this again Works quite well but there

will be times where we have a trend and

we continue higher and we trade above

the high but instead of continuing

higher we sweep the high towards the

left we sweep the most recent low and

then we continue higher so you can

imagine when there's a breakout Trader

above that high who assumes is going

higher with a stop loss below the recent

low right there gets filled in their

order right there immediately is in draw

down their stop- loss gets hit right

there and then we continue higher this

is the origin of a turtle soup and this

is the understanding that we are going

to build onto now this turtle soup is

also known as a liquidity sweep so a

liquidity sweep exact same thing as a

turtle soup as well now next to a

liquidity sweep we also have something

known as a liquidity run or often

referred to as a run on liquidity so

what is then the difference between that

sweep and that run of liquidity well it

all starts with the liquidity part and

you need to understand when we refer to

liquidity liquidity is Swing points so a

swing high is liquidity a swing low is

liquidity again that all refers back to

understanding those Turtle Traders when

they are looking to use their strategy

of breakout trading they refer to swing

highs when the market is strong so

breaking above a swing High the market

is strong and where do most Traders

Place their stop- loss below swing lows

and also above swing highs so liquidity

is Swing points if we take a look at

this example then here we see that swing

point right there which is the swing

High when we talk about a liquidity

sweep then we assume that we trade above

the high like we're seeing right there

we sweep the liquidity by then

immediately continuing lower whilst if

we are talking about a run on liquidity

then we are talking about the following

where if we again have that swing High

instead of trading above it then

continuing lower immediately we continue

in the same direction so we continue

higher so a run of a swing high is that

we can continue higher The Sweep of a

swing high is that we trade above the

swing high and immediately continue

lower so in context of those Turtle

Traders the method that they use by

breakout trading so using the buy stop

to to capitalize on the Move higher they

are expecting a run on liquidity so that

when we take out that swing High we keep

on continuing higher whereas if we have

that sweep of liquidity we do not

continue higher and we immediately after

trading above the high continue lower

now I like to also use the analogy of

being comfortable above a high or a low

and what do I mean by that now the whole

premise behind this liquidity is that

there's a bigger entity involved so the

way the market operates is that when

someone is buying there needs to be on

the other side someone that is selling

so if you are trying to buy a car I need

to sell you that car if you are trying

to sell your car I could buy that car

from you for every seller there needs to

be a buyer for every buyer there needs

to be a seller now for Traders like you

and me who are not trading significant

loss sizes it's not that relevant as in

of course on the other side there still

needs to be a buyer or a seller but we

can get filled our order can get filled

quite easily in the market where if

we're talking about bigger entities in

the market that have such huge orders

that they can't simply click buy or sell

at any moment in time they need enough

opposing liquidity so where they are

trying to buy with a lot of orders they

need on the opposing end a lot of

Sellers as well this is exactly where

the second example comes in because

think about it those Turtle Traders and

not only those Turtle Traders a lot of

Traders are Trend Traders big hedge

funds for example are also known as

trending Traders when we break above

this swing High towards the left they

assume it's going to run that liquidity

and continue higher so they have a buy

stop right there that's what breakout

Traders do and when those buy stops get

filled they of course need to get filled

by someone else selling so if that large

entity wants to sell right there they

have enough buyers to sell to then

there's two things going on right there

those breakout Traders are in a buy

right now when those breakout Traders

are in a buy they Place their stop- loss

below recent swing lows so their stop

loss is what it is a sell order and

those large entities that just sold

right there to the breakout Traders

their buys their take profit can be

below this swing low right there because

that is where those breakout Traders

they're stop stop loss is and since that

stop- loss is a sell order and this take

profit of those large entities is a buy

order a fair exchange can happen again

where they have enough opposing

liquidity to buy to quote unquote

willing sellers so for example on

Australian dollar US Dollar on the

weekly time frame and the reason why we

then look at the weekly time frame is

because the higher time frames are more

relevant that's what large entities work

off of when we break below this low

right here and we assume breakout

Traders are using sell stops to get

involved right there Place their stop

loss above the most recent swing high

right there that's an opportunity again

for large entities to place their buys

as well below this low right here to

then Target the most recent swing High

because then again there's willing

buyers to our cells and when I then

mention that we can't get comfortable

below a low like this is because the

following liquidity sweeps happen

extremely fast we come below the low and

we immediately Target the opposing side

in the form of those swing highs right

there that is because if that large

entity wants their take profit to be hit

and that take profit when they're

looking at buys is a sell order above a

swing high and Above That Swing High we

also had the stop loss of a breakout

Trader that was looking to sell

initially that stop- loss is a buy order

because you're buying back at a loss so

we have willing buyers for the sellers

to take profit and this is only possible

because we are not comfortable below

this low and we have an immediate

aggressive move higher because the

breakout traders that we're expecting

price to continue lower are immediately

almost immediately in draw down since

they are in draw down almost immediately

they have a very difficult time to

mitigate their position meaning they

can't get out of that position very e

easily since they have a difficult time

to get out of that position and they

can't go break even for example because

they are already in draw down then

eventually their stop loss can be used

as the large entities take profit and

that is liquidity sweep whereas if we

compare it with this high right here

where there are also breakout Traders

sitting right there with their stop-

loss below recent swing lows right there

Then here we can see we don't have an

immediate aggressive push lower that

tells us there's no intention to reach

this swing low right there by large

entities because they don't need it at

that time now how do we know it's an

aggressive move by again understanding

fair value gaps expansion phase candles

so when we are comfortable above a high

we can assume that it's a run and we can

at least continue higher towards the

next targets right there that is the

difference between a liquidity sweep and

a liquidity run not only seen from the

perspective Ive of the technical

analysis the chart but also the logic

behind that being comfortable above a

high or being comfortable below a low

now that's not an easy concept to

understand the first time around but

it's not supposed to be easy when you do

understand it it's going to be

absolutely worth it now moving on when

we talk about liquidity we also talk

about previous candle high and previous

candle low bch and PCL why is that well

remember when we talked about kandle

signs and how order flow leads to Candle

signs so multiple candles lead to one

candle well what is a swing high on a

different time frame on left side we

have this swing high sitting right there

this on one time frame can again be a

swing high but if you go up in time

frames that swing High turns into a

previous candle high and when we have

this previous candle High we could also

sweep the previous candle high right

there to then see you lower this is then

through the lens of candle science a

candle science sweep and on the left

side we have an orderflow sweep we're

going to be discussing where we would

like to see order flow sweeps and where

we would like to see candle science

sweeps now before we dive into that

let's again understand where we are

coming from because this is still

talking about the narrative so if we are

going higher or if we are going lower

then where are we going lower from we

had that flaw that first line of defense

we had that overlapping defense and now

we have arrived at the last line of

defense which is the swing point which

is the last area that we can still

continue lower or continue higher from

but we need to understand that the last

line of defense is focused on a lack

without a fair value Gap like we've

already discussed as well in the

narrative video so the last line of

defense is a swing point the last area

we can still continue low for or higher

from then ranking a last L of Defense

from best to worst we want to have no

fair value Gap in the leg so essentially

not an orderflow lack because if we do

have an FG in the lack and it is an

orderflow lack then most likely we can

either respect the fair value Gap or the

fair value area to then continue lower

so the fla or the A and if we do

continue higher and do not respect the

fla or the a then the lot becomes the

Target and not necessarily something we

want to trade from because a last Aline

of Defense in an orderflow lack so with

a fair value Gap in the lag is not very

likely to have a sweep it is more likely

to see a run of that liquidity so the

focus is going to be on the above

example where the last line of defense

is essentially also the first line of

defense it is the only defense that we

have in the lag right there since

there's no fair value Gap there's no

fair value area there's no orderflow

lack so we only have that swing point

that we can continue lower from so those

last line of defenses not being in an

order for lack not having a fair value

Gap that's the ones that we're going to

focus on when we do have a fair value

Gap in the lack and it's just a normal

order for lack that last am of defense

is again not something we want to trade

from it is something we want to trade

towards potentially that is something

that we're going to go over not in the

next video but the video after that now

before we dive into that let's quickly

remind ourselves of the previous candle

high and previous candle low again those

candle science sweeps when we're talking

about previous candle highs previous

candle lows and those order flow sweeps

when we are simply talking about swing

points now the first one we are going to

go over is the orderflow sweep and an

orderflow sweep ideally looks something

like this we create a fair value Gap

this can also be a fair value area so

this can either be an OD or a lot where

the important part is where we are

already expecting higher prices from

then when we are expecting higher prices

and something like this happens we

create a rejection going higher but we

fail to create a new fair value Gap

going higher so the strength the

intention is not fully there well what

happens we leave behind a swing low

without a fair value Gap the low is what

we can now sweep to continue higher and

then we're talking about this swing low

right there that is a swing low but we

can now sweep to then afterwards still

continue higher this is a scenario that

will sometimes happen where we struggle

to continue higher of the initial fair

value area or fair value Gap then we

create a swing low right there and then

continue higher off of that instead now

this sweep below that swing low is then

seen through two lenses because when we

come below that swing low right there on

the same time frame as the swing low it

is seen as a respect candle So based on

candle signs like we've gone over that

respect Candle on the lower time frame

is of course order flow lacks going

lower and then higher on the indices

right here on the E mini S&P we see that

we have a previous order flow lack going

higher right here we trade back into the

fair value Gap and we actually also

trade back into the fair value area

sitting right there now when we trade

back into that we have a re retion so

the rejection happens right here this

rejection fails to follow through now

fails to follow through means that we do

not create a new fair value Gap

afterwards when this is the case and we

then create a swing low right here the

previous fair value area previous fair

value Gap that we had those are already

mitigated so again they can only be

traded into one time but what they do

leave behind at that fair value area and

fair value Gap is a swing low right

there and that swing low right here is

what we can then sweep to then continue

higher this on the same time frame as

this swing low right here is again seen

through candle signs so the respect

candles the Wicks wicking below that

swing low if you go down time frames

then this sweep is again seen through

order flow lacks so we first have order

flow laxs going lower to then order flow

lacks going higher which turns into that

wick on The Daily time frame now I want

to emphasize on the fact right here how

those PD Rays work because a fair value

Gap can be traded into one time a fair

value area can be traded into one time

so if we take a look at this fair value

gap for example right here then this

fair value Gap has already been traded

into with this sting that Wick right

there but whenever we sting into a fair

value gap or into a fair value area we

do leave behind something and that

something is either swing low or swing

high and this leaves behind a swing low

right there that swing low is then used

to continue higher off of instead so

this fair value Gap can already be

deleted from your chart as soon as we

trade back into it it's not relevant

anymore to trade from now when we look

at us dollar JPY right here and we have

our Direction set on lower prices

towards that low right there we create

this Fair V which we can continue lower

from we see the same exact thing we

struggle to continue lower initially we

leave behind a swing high right there

that swing high is what we can continue

lower from not the fair value Gap

because the fair value Gap is already

mitigated if you leave that fair value

on your chart it's not instant to trade

from it becomes just a random box on

your chart if you do not remove that

fair value Gap you lose a lot of

accuracy in your trading but we do leave

behind a swing High That Swing high is

what we can now sweep to then continue

lower from which again seen through two

lenses on the same time frame it's seen

as that candle signs respect candle if

we go down time frames it's again order

flx going higher to then order flx going

lower any fair value Gap that has

already been traded into is not relevant

anymore so for example here we are not

rejecting off the fair value Gap no we

are rejecting of the swing load that we

left behind when we came into the fair

value Gap the first time this is the

same for fair value areas if you keep

that fair value gap on your chart it

just becomes a random boxed and you

might as well just simply trade support

and resistance all right now that is an

orderflow sweep where it's actually a

swing low or a swing high now we're

going to go over that candle science

sweep it's essentially the same thing

because again remember kendle science is

order flow on a different time frame and

Order flow is kendle science on the

higher time frame so this candle science

sweep right here is the following we

have an area that we can continue higher

from so that can again be a fair value

Gap can be a fair value area the first

candle does not reject then we focus on

a previous candle low sweep so on the

example on the left you'll see we have

this swing high right there that we can

Target we run that swing high that turns

into a fair value area right there again

this applies to a fair value Gap fair

value area the same same as an orderflow

sweep can also be applied to a fair

value area or a fair value Gap then when

we retrace back into that discount array

the first candle is not that respect

candle based on candle signs so it's not

a rejection going higher when this is

the case we can see a previous candle

low sweep the previous candle low

sitting right there we can trade below

it to then continue higher this is a

candle science sweep where the previous

candle low is used to then continue

higher off of and that previous candle

low on the lower time frame is again of

course a swing low so it's an orderflow

sweep on a different time frame now this

sweep of that previous candle low and

that Wick just below it is again seen

through two lenses here we have a

respect candle right there but on the

lower time frame it's again orderflow La

going lower and then higher so looking

again at e mini S&P right here we have

this fair value gap which we might want

to continue low from we are running this

low and not sweeping this low to the

left which helps us understand the

overall direction as well then when we

sting into this fair value Gap right

there we see the first candle does not

reject so the second candle sweeps the

previous candle high right there to then

continue lower which again on this time

frame is seen as that respect candle but

if we go down time frames then that

previous candle high is simply a swing

High right here where we see orderflow

Lex going higher to then orderflow Lex

going lower now this is again something

that will happen quite often for example

in this fair value Gap right here first

candle does not reject previous candle

low sweep right there to then continue

higher targeting these highs right there

this is a candle science sweep and this

is essentially the same thing as an

orderflow sweep just seen through

different time frames that's why

everything that we're learning is

fractal it's just about understanding

how we combine those time frames and how

we don't get confused by looking at

different time frames this is liquidity

sweep this is a turtle soup and this

understanding is what we're going to

build on in the next videos but before

we do that do yourself favor and start

doing case studies and the case study

for this video is study orderflow sweeps

in Trends and candle science sweeps so

just mark them out on your chart and see

where they happen see the patterns that

you can notice you can easily do case

studies through the link in the

description where you can get access to

a study notion completely for free as

well all right perfect thank you