Liquidity Sweep + Market Structure Strategy by AIScripts
By AIScripts
Performance Metrics
- Author: AIScripts
- Symbol: NASDAQ:AVGO
- Timeframe: 3 minutes
- Net P&L: +453.11 USD (+0.45%)
- Win Rate: 37.5%
- Profit Factor: 1.602
- Max Drawdown: 163.84 USD (0.16%)
- Total Trades: 48
Description
Strategy ConceptFinancial markets often move toward areas where stop orders accumulate. These areas are usually located above recent highs or below recent lows. When price briefly breaks those levels and quickly returns back inside the range, it can signal that liquidity has been taken and the market may move in the opposite direction.This strategy focuses on detecting those situations. Instead of chasing breakouts, it waits for price to sweep liquidity and then confirm a shift in market structure before opening a trade.How the Strategy WorksLiquidity Sweep DetectionThe script first identifies recent swing highs and swing lows.A sweep happens when:Price moves above a recent high but closes back below itPrice moves below a recent low but closes back above itThis behavior suggests that stop orders were triggered but the breakout did not continue.Market Structure ConfirmationAfter a sweep occurs, the strategy waits for confirmation from market structure.For a long setup, price must break above a recent short-term high after sweeping liquidity below.For a short setup, price must break below a recent short-term low after sweeping liquidity above.This helps reduce random entries.Volatility-Based Risk ControlThe script uses ATR (Average True Range) to calculate stop-loss and take-profit levels.This allows the strategy to adapt to changing market conditions. When volatility expands, exits widen; when volatility contracts, exits become tighter.Key CharacteristicsDetects stop-run style movesConfirms entries using structure shiftsUses volatility-adaptive exitsDesigned for testing and educational purposesWhere This Strategy May Perform BetterThis type of setup often appears during:active trading sessionsvolatile market phasesinstruments with strong liquiditySideways markets with very low volatility may produce fewer reliable signals.