📌 Overview
This New York session trade was based on a classic liquidity reversal setup.
Price swept the previous daily high, traded into a Daily bearish Fair Value Gap (FVG), and then showed lower timeframe confirmation before reversing toward sell-side liquidity.
The setup followed a straightforward model:
Buy-Side Liquidity Sweep → Daily Bearish FVG → M5 IFVG → Sell-Side Liquidity
🧭 Market Context
Going into the NY session, Gold was approaching an area of interest above the previous day's high.
The market pushed higher and successfully swept the previous daily high, taking out resting buy-side liquidity. This move placed price directly within a Daily bearish FVG, a zone where sellers were expected to become active.
Rather than continuing higher, price began showing signs of exhaustion after the liquidity sweep.
This created a strong expectation for a reversal back toward liquidity resting below the market.
🎯 Trade Bias
The bias for this session was bearish based on:
- Previous daily high liquidity sweep
- Reaction from a Daily bearish FVG
- Failure to sustain bullish momentum after the sweep
- Clear draw on Sell-Side Liquidity (SSL)
The combination of higher timeframe premium pricing and liquidity engineering supported a short position.
⚙️ Execution Model
The execution model was:
Liquidity Sweep → Higher Timeframe Rejection → M5 IFVG → Sell Continuation
Entry conditions included:
- Previous daily high taken
- Daily bearish FVG reaction
- M5 IFVG formation
- Bearish rejection after the liquidity grab
The M5 IFVG served as confirmation that the bullish move had likely completed and that sellers were regaining control.
⏰ Timing & Execution
The setup developed during the New York session after the market completed its liquidity sweep above previous highs.
Instead of chasing the breakout, patience allowed confirmation to form before entering the trade.
This significantly improved trade quality and reduced the likelihood of being caught in a continuation move.
📍 Entry & Confirmation
The sell entry was executed after:
- Liquidity above previous daily highs was taken
- Price reacted from the Daily bearish FVG
- M5 IFVG formed
- Market failed to maintain bullish structure
These factors aligned to create a high-probability reversal setup.
🚀 Trade Outcome
After the confirmation formed:
- Price reversed sharply lower
- Buy-side liquidity traders became trapped
- Bearish momentum accelerated
- Market moved toward the sell-side liquidity objective
The liquidity draw below remained the primary target throughout the trade.
🧠 Trade Review
✔ Strengths
- Clear higher timeframe narrative
- Liquidity sweep completed before entry
- Daily bearish FVG provided strong context
- M5 IFVG offered precise confirmation
- Clear liquidity objective below
⚠️ Improvements
- Lower timeframe execution could be refined further for tighter risk.
- Additional confirmation around micro structure shifts may improve overall efficiency.
🔑 Key Takeaway
One of the highest-probability reversal setups occurs when:
- Liquidity is taken above a significant high
- Price reacts from a higher timeframe imbalance
- Lower timeframe confirmation appears
- A clear liquidity target exists in the opposite direction
The best trades often occur after liquidity has been collected—not before.
📌 Conclusion
This setup demonstrated how liquidity, imbalance, and confirmation can combine to create a high-quality reversal opportunity.
The combination of:
- Previous Daily High Sweep
- Daily Bearish FVG
- M5 IFVG Confirmation
- Clear Sell-Side Liquidity Target
provided a clean and repeatable New York session setup.
⚠️ Disclaimer:
This content is for educational purposes only and does not constitute financial advice. Trading involves risk, and past performance does not guarantee future results.
I currently use the prop firm below for my trading and evaluations.
It aligns well with my NY session approach and execution style.
If you want to explore it further, you can check it below:
FundingPips — Prop Firm
Used in my live trading & evaluations
Used for analysis, structure, and execution planning
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