foreign how's it going everyone this video is going to be over how I find my draw on liquidity this is essentially what I do each morning in order to determine my bias for the day the one thing I must note is this is dependent on the time frames I'm entering on I'm entering on the five minute and lower time frames so I'm using the Daily 4 hour and one hour as the time frames where I find my draw however if I was to be entering on the one hour chart I would most likely be looking
up to the weekly and monthly for a draw on liquidity so what is a draw on liquidity well the market searches for external and internal liquidity so if I can determine where the market is likely to draw to or reach for then I can use the lower time frames to gain an entry and manage my risk searching for that higher time frame Target in finding my draw on liquidity I search for external liquidity such as old highs and old lows equal highs and equal lows and then internal liquidity such as fair value gaps and Order
blocks I will also throw in the occasional volume and balance or Gap in price besides those PD arrays I will also search for where price fails to displace over lows and highs as well as where price is displacing to if I follow the displacement it is generally right the best way to show this is just to go through a bunch of examples so that is what we are going to do for this example we are going to be on the NQ 4 Hour chart and focusing on that price action to determine and practice where price
is likely to be headed so for example here we had a gap up and an aggressive move lower following the displacement where are we likely to be headed bit slow or this slope now if you notice we take this low we want to focus do we displace back up into the range pushing a bullish narrative or do we continue to fall down so you can see not really closing above below it right now but then right here can't really displace up and we start to fall lower right so right here I'll look back further in
price but for this example I'm not going to focus on it but you'd want to see some sort of old low being Ram here now I won't switch to being bullish until we get this placement up when we do get this placement up where are we likely to be headed well we have this high right here and this fair value Gap right here but with that in mind if we displace up I'd want to see this Ram into that fair value that would be my draw on liquidity there we go we rush into the fair
value Gap and this volume in Balance now I look here if we are going to go from an OTE of this range back to an OTE of this range what do we have here a fair value Gap as well as a previous low so I would want to see price draw back into here so we hit that low so now if we don't displace below this low or slice through this fair value Gap I'd want to see it move higher so a reach back up into this volume imbalance through there and if we displace through
there as well I'd want to see a reach for this I and you can see we just left this high so that will be a target for later as equal highs and then I kind of missed it but after failing to take that high aggressive move lower we are likely to reach or this low or this low right so then you watch price action so right here looking at it we're failing to displace below this low currently so with that in mind I would say we're likely to draw higher back up into this range right
and if you notice we're drawing up higher but we're not displacing right so this High isn't being targeted however we do have an order block sitting right here that price seems to be respecting so after this is respected where would we want to see a take well I'd want to see it take this slope and possibly this low right so drawing it out I'd want to see price draw lower and their price does draws lower and if you notice after taking this low we don't displace back up that means we're likely to go lower so
I'd want to see this load taken okay we hit that low and the important thing to note is do we displace below this low or do we move up well we don't really do either but we don't take this low so let's go one more candle and since we didn't displace below the slope we're likely to reach for old highs right so this high is taken and then what is in our crosshairs these old highs up here or equal highs and there you go they get Ram so now the important thing to notice here what
happens here that doesn't happen down here well we displace Above This high right so with that in mind I would be targeting this old high up here and you can see we leave it currently and that is where we currently are in price action for this example we're going to use the S P futures from today so we'll start with the daily chart if you notice here we respected the mean threshold of this order block right here and then as starting to move away what do we have sitting right here a higher value gap on
the daily chart so if we move down to the four hour chart you can see we have a four hour fair value Gap nested within this daily fair value Gap and if we go to the hour we can see we also have an hourly fair value up nested within both of those dropping down to a 15 minute chart and analyzing prior to rth open we can see we have this Gap in price right here which you could see was respected and aggressively displaced over then if you notice right here at eight o'clock we drop down
into this fair value Gap here running these internal lows and actually creating an smt with the NASDAQ with that in mind we are likely targeting up into this range go into the one minute for open there was quite a bit of sloppy price action and whipping around but we took the highs right here aimed down took these lows The smt Still Holding and then getting a move higher I wasn't super convinced of this price action so once we made this move out then I was aware of it there is a breaker right here but what
I was focusing on was this border block right here that was created and then I took my entry right here with a stop on this low targeting 39.50 or just slightly before that draw on liquidity and that was my trade for the day now if I didn't know that my drawing liquidity was higher I probably would not have been looking long right here after we ran this High however knowing so I didn't let the lower time frame scare me out of a position and was able to take a trade I hope this video helped you
out if it did please consider liking and subscribing and if you have any questions leave them in the comments below you have a great day see ya
