6/7/23, 12:14 AM LIQUIDITY GRAB STRATEGY | The Prop Trader

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ICT Concepts

Protected: LIQUIDITY
GRAB STRATEGY
INTRODUCTION
The Liquidity Grab Strategy is for the Major FX pairs only, primarily
EURUSD and GBPUSD. The US Dollar Index (DXY) should be used for SMT
Divergence.
The Optimal Trade Entry (OTE) for this strategy is during the London Open
Kill Zone (0200 EST – 0500 EST) and the New York Open Kill Zone (0700
EST – 1000EST).
Only trading during KZs will greatly improve your win rate. Swing highs and
lows are formed within these windows most of the time. Data releases
during these KZs act as a catalyst for set ups.
The OHLC of the previous HTF candle will give you all the context you
need for a bias. Wait for the previous HTF candle HIGH or LOW to get
raided, then pick your LTF to execute on & create a blueprint for entry &
invalidation.
Firstly, establish a Higher Timeframe (HTF) Bias. Mark important Swings
and Points of Interest (POI). Liquidity will rest above and below these
levels:
Asia, London, New York Session Highs & Lows (PSH/PSL)
Previous Daily Highs & Lows (PDH/PDL)
And Higher Time Frame Draw on Liquidity Levels e.g. Previous
Weekly & Monthly Highs & Lows (PMH/PML & PWH/PWL)
When a market has no Bias or Draw On Liquidity, wait for Displacement.

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TRADE ENTRY
If trading the London KZ, the PSH/PSL would be the Asia Range High &
Low (2000 – 0000 EST). If trading the New York KZ, the PSH/PSL would
be the London Session High & Low (0200 – 0500 EST). Accumulation
occurs during the trading range.
During a KZ watch for a external Liquidity Raid of any of the above. This is
the Manipulation. We are interested in a Smart Money Reversal (SMR) off
one of these levels.
Wait for an impulsive LTF Break of Structure (BOS/MSB), then locate a
internal Liquidity Pool left by this explosive reversal. Wait for a Breaker to
form and a FVG to be created. Enter when price Returns to Breaker (RTB).
The 1m, 2m & 3m charts are the best for finding FVG/Imbalances. High
Frequency Trading (HFT) algorithms operate on nothing higher than 3m
Imbalances.
Now the Distributions happens.
TRADE EXIT
Firstly target Internal Liquidity in the form of FVGs and EQH/EQL and then
External Liquidity in the form of PSH/PSL and PDH/PDL, etc.
FVGs or Imbalances are areas of Liquidity. The Algo will balance out this
inefficient price action by returning to this area. Price delivers to this area
to pick up liquidity and distribute it to willing Buyers and Sellers.
For example, if a previous YEARLY HIGH / LOW is raided, price action will
pullback and fill the nearest WEEKLY FAIR VALUE GAP (FVG) or
IMBALANCE .
The same applies to the lower timeframes as follows:
YEARLY HIGH / LOW RAID -> WEEKLY FVG FILL
MONTHLY HIGH / LOW RAID -> DAILY FVG FILL
WEEKLY HIGH / LOW RAID -> H4 FVG FILL
DAILY HIGH / LOW RAID -> H1 FVG FILL
SESSION HIGH / LOW RAID -> M5 FVG FILL
H4 HIGH / LOW RAID -> M5 FVG FILL
H1 HIGH / LOW RAID -> M1 FVG FILL

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The Asia, London and New York Session HIGH / LOW are usually the same
as the 4H HIGH / LOW.
External Buy Side (BSL) and Sell Side (SSL) Liquidity rest above and below
Swing High and Lows.
BUY SIDE / STOP LIQUIDITY – BSL
The BSL is a pool of Buy Stop orders with their respective Stop Losses.
When BSL is taken out (Buy Stops activated), the market reverses to the
downside (clearing the Stop Loss orders). Where to spot BSL:
Previous Month High – PMH
Previous Week High – PWH
Previous Day High – PDH
Previous Session High – PSH
High of Day – HOD
Old High/Swing High
Equal Highs – EQH
SELL SIDE / STOP LIQUIDITY – SSL
The SSL is a pool of Sell Stop orders with their respective Stop Losses.
When SSL is taken out (Sell Stops activated), the market reverses to the
upside (clearing the
Stop Loss orders). Where to spot SSL:
Previous Month Low – PML
Previous Week Low – PWL
Previous Day Low – PDL
Previous Session Low – PSL
Low of Day – LOD
Old Low/Swing Low
Equal Low – EQL
TRADING LIQUIDITY
A Liquidity setup should include the following:
Stop Hunting – SH. This is simply a false breakout above/below the
zone where Liquidity is residing
Break-in Market Structure – BMS/BOS. This is when market
structure is broken (HH or LL for a continuous trend) or (HL or LH for
direction change/ChoCh)

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Factors to Consider when Trading Liquidity:

The Trend: Trend is your friend, so always trade in line with HTF
trend direction & DOL
Supply & Demand: Consider market imbalance and accomplishment
Support & Resistance – EQL & EQH: Always wait for fake-out at the
SnR zones
Compression: This is the best way to know if price is retracing
LIQUIDITY GRAB STRATEGY
1. New York Kill Zone (0700 – 1000 EST)
2. PDH / PDL or PSH / PSL (London) Raid
3. Sweep (BSL / SSL Taken) @ Origin of move (High / Low Candle)
4. Market Structure Break MSB & FVG Created
5. Return To Breaker RTB
6. SL @ 1R – Origin of move (High / Low Candle)
7. TP @ 3R – 50% HTF Candle or HTF HL
LIQUIDITY GRAB STRATEGY EXAMPLE 1:
In the following EURUSD example, the London Session High (BSL) is
raided pre New York Open before price collapses to the downside
Breaking Market Structure (BMS) in the NY Open Kill Zone targeting the
opposing London Session Low (SSL) Internal Liquidity and finally targeting
the PDL/SSL External Liquidity.

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LIQUIDITY GRAB STRATEGY EXAMPLE 2:

External to Internal Liquidity
Accumulation during CBDR & Asia Range
Previous Daily High PDH BSL Liquidity Grab – Manipulation
LTF Break of Structure BOS
Return to Fair Value Gap FVG
Target LTF EQL SSL & HTF Order Block OB / DOL – Distribution

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LIQUIDITY GRAB STRATEGY EXAMPLE 3:

Weekly 3-Bar Swing Low & +OB
Daily EQH & Retest of +OB & FVG DOL
1H BOS + Displacement + FVG
15m Internal to External Liquidity EQH PDH DOL
High Probability Bullish OB
BOS + Displacement + FVG
External Liquidity PDH EQH BSL
Internal Liquidity IDM EQL SSL
LTF Liquidity Grab @ 0700 NY Killzone
LTF FVG Redelivery in Discount

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WEEKLY

DAILY

1 HOUR

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15 MINUTE

APPENDIX
ABBREVIATIONS < https://theproptrader.co/ict-smart-money/>

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