HTF Liquidity

The ICT Liquidity Sweeps Indicator is designed to track liquidity zones in the market areas where stop-losses and pending orders are typically clustered. This indicator marks buyside liquidity (resistance) and sellside liquidity (support) from HTF (H4, H1 and M15), helping traders identify areas where price is likely to manipulate liquidity before making a significant move.

This tool is based on Inner Circle Trader (ICT) Smart Money Concepts, which emphasize how institutional traders, or “Smart Money,” manipulate liquidity to fuel price movements. By identifying these zones, traders can anticipate liquidity sweeps and position themselves accordingly.

⚙️ How It Works

1️⃣ Detects Key Liquidity Zones
The script automatically identifies significant swing highs and swing lows in price action using a pivot-based method.
A swing high (buyside liquidity) is a peak where price struggles to break higher, forming a resistance level.
A swing low (sellside liquidity) is a valley where price struggles to go lower, creating a support level.
These liquidity points are prime targets for liquidity sweeps before a true trend direction is confirmed.

2️⃣ Draws Liquidity Lines
Once a swing high or low is identified, a horizontal line is drawn at that level.
The lines extend to the right, serving as future liquidity targets until they are broken.
The indicator allows customization in terms of color, line width, and maximum number of liquidity lines displayed at once.

3️⃣ Handles Liquidity Sweeps
When price breaks a liquidity level, the indicator reacts based on the chosen action setting:
Dotted/Dashed: The line remains visible but changes style to indicate a sweep.
Delete: The line is completely removed once price has interacted with it.
This feature ensures that traders can easily spot where liquidity has been taken and determine whether a reversal or continuation is likely.

4️⃣ Prevents Chart Clutter
To maintain a clean chart, the script limits the number of liquidity lines displayed at any given time.
When new liquidity zones are formed, the oldest lines are automatically removed, keeping the focus on the most relevant liquidity zones.