Core Concepts
Buy-Side Liquidity (BSL)
Orders resting above a price level — buy stops, breakout orders, short stop losses
Buy-side liquidity refers to the collection of orders resting above a price level. This includes buy stop orders, breakout entries, and stop losses from short positions. The market is drawn to these clusters because they represent pools of orders that can be consumed to facilitate larger moves. In a bullish trend, buy-side liquidity above swing highs is the external range liquidity target during impulsive phases.
✓How to Recognize
- •Orders cluster above swing highs and resistance levels
- •Includes buy stops, breakout orders, and short stop losses
- •Targeted during bullish impulsive phases
- •Sweeps above highs fuel downside reversals or continuation moves
⚡How to Avoid
- →Entering breakouts without confirming whether liquidity is being swept
- →Placing stops at obvious levels where BSL clusters
- →Ignoring that a sweep of BSL may reverse immediately
- →Confusing a BSL sweep with a genuine breakout