Liquidity Run (Continuation Run / LRLR)
A Liquidity Run is a continuation price movement where price not only takes a liquidity pool (such as prior highs/lows) but *accepts* the break and continues in the direction of the prevailing trend. This contrasts with a Liquidity Sweep where price takes liquidity and then reverses direction.
Definition
A Liquidity Run occurs when institutional order flow pushes price through a known liquidity level and continues in the same direction with follow-through and acceptance, indicating that the market has committed to the trend and is using the captured liquidity as fuel for continuation.
Why It Matters
Identifying Liquidity Runs allows traders to recognise when price is not merely hunting stops (as in a sweep) but truly advancing toward the next liquidity target, supporting trend continuation trades. Liquidity Runs form the backbone of trend execution in Smart Money trading logic.
How to Identify
- Identify the **prevailing trend** on higher timeframes (bullish or bearish).
- Mark key liquidity pools (e.g., previous swing highs/lows, equal highs/lows, prior session extremes).
- Observe price **break through** these liquidity zones.
- Check for **acceptance** — multiple closes beyond the level rather than brief wicks only.
- Confirm continuation with structure break (new high in uptrend or new low in downtrend).
How to Trade
- Label liquidity target levels ahead of time based on structure.
- Wait for price to break and accept the liquidity level (not just a single wick breach).
- Look for price to continue direction on subsequent candles — this indicates a run.
- Enter on pullback/retrace into a value zone (PD array, FVG, Order Block) aligned with the trend.
- Place stop loss just beyond the invalidation level (below the liquidity zone for longs; above for shorts).
- Targets: internal liquidity first, then larger external targets (higher timeframe swing levels).
Common Confusions
Liquidity Sweep takes liquidity **then reverses**, whereas Liquidity Run continues in the **direction of the trend** after taking liquidity.
Only breakouts with **multiple closes and continuation in trend** qualify as runs — a single abortive breakout can be a sweep.
Liquidity Runs are continuation moves that require alignment with broader market structure trends, not random price spikes.
Pre-Trade Checklist
- Liquidity pool clearly identified (equal highs/lows, prior swing)?
- HTF bias supports continuation OR clear draw on liquidity beyond level?
- Acceptance confirmed (closes beyond level, not just wick)?
- Follow-through/displacement after breakout?
- Entry on retrace into FVG/OB created by run (safer)?
- Targets: next internal liquidity, then next external liquidity?
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Educational resource only. Not financial advice. Trading involves substantial risk of loss.