Liquidity Pool

Liquidity pools are created above and below price, a liquidity pool can be above and below old highs and lows. The form of these highs and lows determines how current price might react to get to these levels and or move away from these levels. ICT created the term "clean lines" meaning a double type high or low that is closely at the same levels from where price moved away from, leaving liquidity above or below these areas. Price will hunt these specific areas as market makers drive price into these liquidity pools to take out stops and market orders. After the price objective is completed, they will reverse price and move away from the targeted area. The time frame objectives for liquidity pools to be formed can differ from high time frame to low time frame. Using the higher time frame designed liquidity pools can really benefit a trader and giver him or her great directional bias, either when price is hunting liquidity or moving away from liquidity.