Smart Money Concepts (SMC) Analysis
1. Liquidity Sweep & Break of Structure (BOS):
Price consolidates above a trendline with multiple rejections (blue lines).
A liquidity grab occurs below this trendline – classic inducement setup.
After the grab, a bearish BOS (break of structure) is confirmed with a strong candle closing below the trendline and recent lows.
2. Order Block:
Price retested a 4H bearish order block (grey shaded zone) before rejection. This OB aligns with the last bullish candle before the drop.
Rejection from the OB confirms institutional interest (SMC).
3. Imbalance / Fair Value Gap (FVG):
The drop left a minor imbalance zone, suggesting possible continuation down to fill the inefficiency.
Price Action Analysis:
1. Trendline Break:
Ascending trendline has been broken with strong bearish momentum.
Indicates a shift from higher lows to lower lows → possible trend reversal.
2. Supply Zone Respect:
The price failed to make a new high and was firmly rejected at resistance.
Double top or lower high formation adds bearish confluence.
3. Target & Risk-Reward:
The trade setup indicates a short entry just below trendline break.
Target around 1.29393, likely based on previous demand zone or liquidity pocket.
Stop above 1.33664, likely above the OB or structural high.
Solid RRR (>3:1) visible.
Confluences Supporting Bearish Bias:
Break of internal structure (Price Action)
Liquidity sweep below trendline (SMC)
Bearish Order Block rejection (SMC)
Strong bearish engulfing candle
Favourable RR trade plan
Conclusion:
This is a high-probability bearish setup combining a trendline liquidity sweep (inducement), break of structure, order block rejection, and efficient risk-reward positioning. The price is expected to target 1.29393, aligning with a previous demand or liquidity zone.
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