MAMAYTrading Terminal

Smart Money: liquidity and chart markup

3 min read · What Smart Money is in plain words: liquidity and imbalance, plus the button, indicators and screeners MAMAY uses to mark them up on the chart.

Level:

Short version for experts: tables, lists and screenshots only.

Words in this lesson (13)
Stop — A price chosen in advance at which the trade is closed at a loss, so the loss doesn't grow bigger.
Volume — How much money or how many units changed hands over a period. A move on high volume is more reliable than one on low volume.
Timeframe — What stretch of time one candle on the chart shows: a minute, an hour, a day.
Candle — A bar on the chart for one stretch of time: where the price opened, where it closed, its high and its low.
Level — A price where the market has already turned before. Support is below the price, resistance is above it.
Breakout — The price has gone through a level and held beyond it.
Screener — A filtering program: it scans hundreds of stocks or coins and shows only those that match the given criteria.
Liquidity — How easy it is to buy or sell the size you need without moving the price. Little liquidity — hard to get in and out.
Slippage — The difference between the price you saw and the price at which the trade was actually filled.
Fee — What you pay the exchange for every trade — both on entry and on exit.
Position — An open trade: what you have bought or sold and haven't closed yet.
DEMO — The DEMO account in MAMAY: prices and fees are real, orders don't go to the exchange, and no real money is at risk.
Backtest — Testing a rule on past data: what would have happened if we had traded this way before.

The idea in a nutshell

A big player needs plenty of opposite orders to build a position without slippage. The most of them sit where the crowd keeps its stops: below an obvious low, above an obvious high. That's why price so often pokes past such a level, takes out the stops and turns around. Smart Money is a way to read these spots by rules rather than by eye.

In MAMAY, Smart Money is first of all markup and scenarios with an invalidation zone, not "enter on the signal": the "◈ Smart Money" button on the chart, five indicators and screeners for crypto, US stocks and Russian stocks (Pro plan). MAMAY shows the results of its own historical test inside the program.

Liquidity

Liquidity is a cluster of stop-losses and resting orders. Equal lows, "support that held three times", a round high — a floor for the crowd, a stock of opposite orders for a big player. The rule: a real demand zone appears after liquidity has been taken, not before.

Imbalance (FVG)

Three candles in a row where the ranges of the first and third don't overlap: for a bullish one, the high of the first is below the low of the third. The gap between them is an imbalance — a stretch price ran through one way with almost no trading against it. Price often comes back to "fill" it. A BPR is where a bullish and a bearish imbalance overlap.

Five indicators on the chart

The "Indicators" window (the button above the chart) → the "Smart Money indicators" section, right below "MAMAY indicators"; the quickest way is the "Smart Money" filter button. They work on any full MAMAY chart and on any timeframe.

  • Structure — HH/HL/LH/LL, BOS and CHoCH. The yellow "HL weak" mark is a level that formed in thin air. The sub-structure and minor breaks (mBOS) are turned on in the settings.
  • True break — a dashed line from the level to the breakout candle and a label with its depth: you can see how real the breakout is.
  • Sweep hunter — a box of the liquidity taken, with a label. You can show every case or only the most complete ones.
  • Order blocks & imbalances ("OB · FVG" in the legend) — OBs, FVGs and BPRs; live ones extend to the right, used-up ones fade.
  • Premium / discount — 1 · premium, 0.5 · equilibrium, 0 · discount.

On the chart all of this is one "Smart Money" legend line with a "simple / history" switch: in "simple" only the latest items are shown, the zones are faint, and premium/discount is a strip by the price scale. The "Templates" tab has ready-made sets: "Smart Money — full set", "— structure only", "— liquidity hunt". A label's tooltip shows what it is, the price, the depth in ATR and a line from our backtest. Without Pro, "Structure" is available on 1H and above.

How to use it

  1. Learn to read the markup: where liquidity was taken, where the break is, where the zone is, where price sits in the range. It's useful even without a trade.
  2. Work from a scenario with an invalidation zone: you know in advance which close proves the idea wrong.
  3. Stick to 1H: on lower timeframes fees eat too large a share of the risk.
  4. Test your own rules in DEMO first and check the result in signal performance.

The trade decision, size and risk are always yours.

↗ Open "Smart Money Crypto" in MAMAY ▶ Smart Money on US stocks ▶ Smart Money on Russian stocks

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