Liquidations Levels [RunRox]

📈 Liquidation Levels is an indicator designed to visualize key price levels on the chart, highlighting potential reversal points where liquidity may trigger significant price movements.

Liquidity is essential in trading - price action consistently moves from one liquidity area to another. We’ve created this free indicator to help traders easily identify and visualize these liquidity zones on their charts.

📌 HOW IT WORKS

The indicator works by marking visible highs and lows, points widely recognized by traders. Because many traders commonly place their stop-loss orders beyond these visible extremes, significant liquidity accumulates behind these points. By analyzing trading volume and visible extremes, the indicator estimates areas where clusters of stop-loss orders (liquidity pools) are likely positioned, giving traders valuable insights into potential market moves.



As shown in the screenshot above, the price aggressively moved toward Sell-Side liquidity. After sweeping this liquidity level for the second time, it reversed and began targeting Buy-Side liquidity. This clearly demonstrates how price moves from one liquidity pool to another, continually seeking out liquidity to fuel its next directional move.



As shown in the screenshot, price levels with fewer anticipated trader stop-losses are indicated by less vibrant, faded colors. When the lines become more saturated and vivid, it signals that sufficient liquidity - in the form of clustered stop-losses has accumulated, potentially attracting price movement toward these areas.

⚙️ SETTINGS


🔹 Period – Increasing this setting makes the marked highs and lows more significant, filtering out minor price swings.
🔹 Low Volume – Select the color displayed for low-liquidity levels.
🔹 High Volume – Select the color displayed for high-liquidity levels.
🔹 Levels to Display – Choose between 1 and 15 nearest liquidity levels to be shown on the chart.
🔹 Volume Sensitivity – Adjust the sensitivity of the indicator to volume data on the chart.
🔹 Show Volume – Enable or disable the display of volume values next to each liquidity level.
🔹 Max Age – Limits displayed liquidity levels to those not older than the specified number of bars.

✅ HOW TO USE


One method of using this indicator is demonstrated in the screenshot above.

Price reached a high-liquidity level and showed an initial reaction. We then waited for a second confirmation - a liquidity sweep followed by a clear market structure break - to enter the trade.

Our target is set at the liquidity accumulated below, with the stop-loss placed behind the manipulation high responsible for the liquidity sweep.

By following this approach, you can effectively identify trading opportunities using this indicator.

🔶 We’ve made every effort to create an indicator that’s as simple and user-friendly as possible. We’ll continue to improve and enhance it based on your feedback and suggestions in the future.