How to use Free TradingView Indicator to detect Liquidity TrapsPerformance on Shared BTC/USDT Chart
Indicator : Liquidity Trap Detector (LTD)
Timeframe: 15-sec (as per chart)
Observation Period: Full session visible in the screenshot
1. Bull Traps Detected: 4
• Major traps occurred during local tops where price sharply reversed.
• Example: ~19:15 and ~21:00 marked strong reversals after fake breakouts.
2. Bear Traps Detected: 5
• Triggered near local bottoms, followed by short-term rebounds.
• Example: ~22:15 and ~00:30 triggered after sudden downward sweeps.
3. Accuracy:
• Approx. 70–75% of traps correctly led to meaningful reversals.
• A few signals occurred during trend continuation, indicating strong momentum rather than a trap.
4. False Signals:
• Some Bull Trap signals appeared during minor pullbacks that continued trending up.
• Filtering with cooldown periods or trend filters (e.g., EMA alignment) can reduce noise.
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Key Takeaways
• Best Use Case:
• Short-term scalping and identifying liquidity sweeps before reversals.
• Works well in ranging or high-volatility conditions.
Caution:
• In strong trending markets, some signals may mark pause points, not full reversals.
• Combining LTD with higher timeframe trend confirmation improves reliability.
