Core Concepts
Structural Inducement
Liquidity directly in front of a zone that broke structure — the strongest form of inducement because the stops behind it fuel the zone reaction
Structural inducement is the highest quality form of liquidity that sits in front of a point of interest. Unlike general liquidity (equal highs/lows anywhere on the chart), structural inducement is a level that broke structure, creating stops from traders who entered on that break. When price sweeps this structural level, the resulting orders fuel the zone reaction immediately. The key factors are proximity (directly adjacent to the zone), structural significance (broke something to create strong stops), and continuity (sweep and zone reaction are one connected move).
✓How to Recognize
- •Look for a structural level (one that broke a previous swing point) sitting directly in front of your zone
- •The sweep of inducement and the zone reaction should be essentially one continuous move — no long journey between them
- •Structural inducement creates Tier 1 zones — the sweep provides massive fuel from trapped traders stops
- •Ask the distance test: if this liquidity gets swept, will price immediately enter my zone? If yes, it is inducement
⚡How to Avoid
- →Treating distant liquidity as inducement for a specific zone — equal highs three legs away are targets, not inducement
- →Assuming all equal highs/lows near a zone count as structural inducement — they must have broken structure
- →Ignoring proximity — if you have to draw a long line between the sweep and the zone, the fuel was used up along the way
- →Rating a zone as Tier 1 when the nearby liquidity is just equal levels without any structural break behind them