Majors Liquidity Fade [Plazo Sullivan Roche Capital]

Purpose:
This indicator exploits the two-phase structure of the New York session — early liquidity sweeps (fakeouts) followed by momentum continuations aligned with institutional order flow.

Liquidity Fade (8:00–10:30 AM ET)

Detects stop hunts beyond Asian/London highs or lows.
Looks for weak momentum and wick dominance to confirm fading exhaustion.
Entry bias is counter-trend for quick mean reversion.

Continuation Phase (10:30 AM–2:00 PM ET)

Once early liquidity is absorbed, the algorithm looks for price reclaiming VWAP or breaking a minor structure.
It then signals trades in direction of higher timeframe bias.
This captures institutional trend continuation during peak U.S. volume.

Result:

Two distinct opportunities per NY session:
Fade setups exploit false breaks.

Continuation setups ride institutional expansion.

Bias Filters & Context Alignment

H1 20 EMA
Determines short-term directional bias. Prevents counter-bias entries.

HTF Filter (H4 & Daily)
Confirms alignment using 200/20 SMA and 50 SMA. Matches trades with macro direction.

DXY Strength Check
Optional confirmation (USD trending). Adds macroeconomic correlation logic.

VWAP Mean Deviation
Measures institutional value zones via session VWAP ±σ. Detects overextensions and reversions.Bias Filters & Context Alignment

H1 20 EMA
Determines short-term directional bias. Prevents counter-bias entries.

HTF Filter (H4 & Daily)
Confirms alignment using 200/20 SMA and 50 SMA. Matches trades with macro direction.

DXY Strength Check

Optional confirmation (USD trending). Adds macroeconomic correlation logic.

VWAP Mean Deviation
Measures institutional value zones via session VWAP ±σ. Detects overextensions and reversions.

Protection Mechanisms


Session Gating
Limits entries to NY liquidity windows (8:00–14:00 ET). Avoids low-volume fakeouts.

ADR Guard
Disables signals if intraday range > 1.5× ADR. Filters out overextended or news-driven days.

CVD Divergence
Confirms price–volume divergence at liquidity grabs. Detects fake moves and exhaustion.

Small Body + Wick Confirmation
Ensures trap candle characteristics before signaling. Increases fade accuracy.

RSI Confirmation (5m)
Confirms momentum shift (above/below 50). Adds order-flow timing filter.

News Safety Toggle
Manually pause entries pre-FOMC/NFP/etc. Prevents false signals from macro spikes.

How to Read the Chart

🔺 Green Triangle Fade Long (after sweep of low) Countertrend buy scalp
🔻 Red Triangle Fade Short (after sweep of high) Countertrend short scalp
🟢 Green Circle Continuation Long Trend-following buy
🔴 Maroon Circle Continuation Short Trend-following sell

⚙️ Best Practices

✅ Trade the NY session only.
The logic is calibrated for U.S. market liquidity between 8:00–14:00 ET.

✅ Check higher-timeframe alignment.
Only take trades aligned with HTF bias and VWAP position.

✅ Use 0.5% or less risk per trade.
Combine with external execution rules (e.g., partials at VWAP return, full close at ADR midpoint).

✅ Avoid high-impact news.
Pause News Safety manually around CPI, FOMC, or NFP.

✅ Prioritize confluence.
Best trades occur when:

Fade aligns with CVD divergence + wick dominance.

Continuation aligns with VWAP reclaim + RSI > 50 (for longs).

✅ Ideal pairs:
EUR/USD, GBP/USD, XAU/USD, and NASDAQ (US100 CFD).
Avoid exotic or illiquid pairs.

🧭 Summary Formula
Institutional Flow = (Bias Alignment) × (Liquidity Sweep) × (Confirmation Signals)

When all three align, the setup is statistically favorable.