EURCHF — the liquidity was taken, and there is no trade

1. We continue the practice: building pattern recognition. The asset is the euro against the Swiss franc, working timeframes daily and four hours. We pick a random bar in history and land at the end of twenty twenty four. What is to the right we do not know — we read it as if we were trading right at that moment.

2. The first thing we define is the trend. The move looks bearish, but «it looks bearish» is not markup. We mark the last two trade ranges. Both show the same thing: the low is taken out with a body close, while the highs hold — price does not break them. Two such ranges in a row are the confirmation of direction. It stays valid until price takes out the high of the last one.

3. Now the latest situation. Price reached the low of the last range and could not settle below it, and the reaction is strong. But a strong reaction and a confirmation are different things. There is a rejection here, but no rejection block, so there is no most traded volume zone either — on the chart it is labelled MTV. And with no confirmation, we rather expect the liquidity to be taken again.

4. That is what happens. The buyers fail to hold the level, and price takes the liquidity a second time. After that a daily most traded volume zone appears — on a specific candle, and we label it.

5. And here is the most important part of the whole read. The zone is there, the liquidity is taken — and it is still too early to take part. The reason is simple: there is no trade range. Before this there were two, both bearish. Here liquidity is taken from the low alone, without a criterion that would give it meaning. Even trading against the trend, a range still has to be there. So the decision is to wait.

6. The wait is short. Price starts the first impulse, and a range forms. Then it comes into the discount zone of that range. Now there is something to hold on to: the nearest target is the high of the range, and above it there is more liquidity if the move continues.

7. To get point A we look at what price interacts with in discount. It is the nearest liquidity. On the first candle there is no confirmation yet, it appears on the second — and that zone becomes a local MTV zone.

8. We fix the read with three questions. Where is price — in the discount zone of the daily trade range. What is it interacting with — the daily fractal that forms the MTV zone. Where is it heading — to the high of the trade range.

9. Now we check ourselves with the Trade Model indicator. We open the direction panel across timeframes: daily, weekly, monthly. The bearish direction is confirmed, and the last trade range we marked by hand matches what the indicator draws.

10. Next we rebuild the markup locally. From the point where price twice refused to go lower, we take the direction as bullish. From the outside it looks like a correction, but for local work this is the direction of the move. The range again matches the markup.

11. Two order flow zones appear. The second one is stronger, and here is why: it crosses the weekly imbalance. We turn imbalances on — on the weekly it is visible, on the daily it is tested and it landed right inside the flow zone.

12. We put it together. The order flow is crossed with an imbalance, and price reached the liquidity inside that flow — by our research such a zone counts as strong. The reaction reaches the daily fractal and is confirmed by a daily MTV zone.

13. What we marked by hand matches what the engine calculates. We check the hypothesis: price comes into the MTV zone, tests it sharply with a wick and leaves for the established high.

The liquidity is taken and a most traded volume zone has formed — and it is still too early to take part: there is no trade range, so there is no criterion that would give that sweep any meaning. Two candles later the range forms — and only then does the idea become an idea.

We draw the MTV zone by hand — the FocusProfit Trade Model indicator does not build it. What matched the indicator here were the direction and the bounds of the trade range, not the zone. See the broader framework in the methodology section, why a binary entry criterion removes the need for willpower in why you break your own trading system, and more episodes in market analysis practice.