What's the Difference Between Break Of Structure And Liquidity Sweep/ Fake out ?

I get asked this question a lot.

So I thought to make a post on it and teach you the difference between a break

structure and a liquidity sweep.

This will help you to identify false market structure shifts and to get on the right side of the trend.

A break of structure: (See the chart for example)

- Will usually be in the direction of the overall trend you are trading.

- It will break a structural point with clear momentum and continue to trade above or below that break depending on if the trend is bullish or bearish.

A liquidity sweep: ( See the chart for example )

- Will usually be in the opposite direction of the overall trend of the timeframe you're trading.

- The sweep will break out of structure and then quickly trade back inside the structural point that was broken.

it can be just a wick and sometimes one candle closes above the structure and then drop back inside it.

Keep Learning.