Draw on liquidity and daily bias

What it is

The draw on liquidity is the level price is most likely to reach next: an obvious pool of stops (previous day or week high or low, equal highs or lows) or an unfilled gap. Your daily bias is the direction that implies.

Traders often split it into external liquidity (the highs and lows of the range) and internal liquidity (FVGs inside it). Price tends to move from one to the other.

How to spot it

• Mark the previous day's and week's highs and lows, equal highs and lows, and open gaps.
• Ask which one price is closer to and which way structure points.

How to use it

• Only take setups that move towards the draw.
• Use the draw as your target, and stop looking once it's been reached.

Common mistakes

• Picking a bias and refusing to change it when structure shifts.
• Having several 'draws' in both directions, which is no bias at all.

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