A swing high after a strong multi-candle rally with large-range candles is far more significant than one formed after two small candles. The size of the creating move correlates with the significance of the exhaustion signal.
A swing high followed by a 10+ candle decline or 30%+ retracement is more significant than one followed by a 2-candle pause. The depth of the reversal confirms the exhaustion was genuine.
If you need to zoom in to see it, it is a noise swing point, not a structural one. Significant swing points are visible at the current timeframe scale without magnification.
The swing point represents a structural extreme — the most recent HH, HL, LH, or LL in the current trend sequence. If it is neither the current highest high nor the most recent higher low, it is a historical swing point, not an active structural reference.
Every significant swing high attracts stop-losses from traders who shorted below it and buy-stop orders from breakout traders. The AMD Judas sweep targets BSL above swing highs (bearish AMD) or distributes to BSL above swing highs (bullish AMD delivery target).
Every significant swing low attracts stop-losses from longs and sell-stop orders from breakdown traders. The bullish AMD Judas sweep targets SSL below swing lows before the MSS displacement reverses toward the bullish target.
Draw horizontal rays from the wick extreme. Solid line for external (active structural reference). Dashed line for internal (within the leg). This ensures your BOS/CHoCH levels align with actual stop placement.
HH, HL, LH, LL — and note whether internal or external. “iHL” for internal higher low. “eHH” for external higher high. The label tells future-you the structural weight at a glance.
Each new HH creates a new external swing high. The prior external becomes internal. Update your marks as part of the pre-session routine — stale swing points produce stale analysis.
Stops cluster above wick highs and below wick lows. Body-based identification places every structural and liquidity level at the wrong price. The wick tip is the swing price — always.
Apply the significance filter. If the swing point is not visible at chart scale, was not created by a substantial move, was not followed by a meaningful reversal, and does not define current structure — do not mark it.
The same “break below a swing low” carries completely different weight depending on whether it is an internal HL (minor event) or the external lowest low (major structural shift). Label every swing point.
A potential swing high is not confirmed until the right-side candle closes with a lower high. Entering a short because price “looks like it has peaked” is acting before the structural signal is complete.
Each new HH creates a new external swing high. The prior external becomes internal. Working from stale swing points means referencing a PDH that has been exceeded by three new highs.
Lio has traded ICT and Smart Money Concepts on forex majors and US indices since 2021 and built LiquiditySweeps.com to teach the framework the way it should be learned: in sequence, on real charts, with free live tools instead of paid indicators. Every article on this site follows the same rule — nothing gets published that wouldn’t survive a trade review.
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