A trader shows how to set up a 1:12 risk-reward trade by identifying liquidity zones on higher timeframes for direction, then using lower timeframes to enter when a low gets stabbed. Stop goes just below that low, target hits the 1:12 ratio.
You're looking at a 1:12. This is textbook stuff. Beautiful. We run an old low from the left. We are bullish. We want to see price to the upside. Now look at this price action. This very, very choppy PA on the way to the upside. We have all of this liquidity to the left. Don't forget the higher. This engineered liquidity up here. This is now known as engineered liquidity. How do we get involved? This price action, it's building liquidity. How do I enter the market? This level was respected, which means there's going to be liquidity below here. And watch this. You have your entry as soon as the low gets stabbed. Stop loss goes below the low. And of course, this is going to be on a chart. Let's give it a little bit of breathing room. Target to the upside, you're looking at a 1 to 12. And if I just zoom out, there you go. The beauty of this model is it happens on the higher timeframe for direction, on the lower timeframe for entry.
