Fibonacci Retracement, Market Structure, Liquidity, Supply and Demand Strategy

Learn a multi-confluence SMC trading strategy for EURUSD and GBPUSD on Daily/4-hour charts, combining Fibonacci, market structure, liquidity, and supply/demand

Published · Updated · Methodology: SMC

Part of: Liquidity Sweeps & Grabs

  • Methodology: SMC
  • Content type: strategy
  • Timeframes: Daily, 4-hour
  • Markets: EURUSD, GBPUSD

Indicators used

  • Fibonacci Retracement
  • Supply and Demand Zones
  • Price Action

Source video

Decoded from: The Best Strategy to Pass Prop Firm Challenges by The Trading Academy — watch the original

Key timestamps:

  • 0:30 - Strategy overview
  • 1:00 - Fibonacci retracement (premium/discount)
  • 1:40 - Market structure (fractal structure)
  • 2:30 - Supply zone identification
  • 3:00 - Liquidity types explained
  • 4:50 - Entry conditions on 4-hour timeframe
  • 6:00 - First trade example (EURUSD)
  • 8:00 - Second trade example (GBPUSD)

Strategy overview

A liquidity sweep is the move that runs price through an obvious high or low to trigger the stop orders resting there before reversing away from them. What separates this entry from most sweep-based material is that the strategy is assembled backwards from a constraint rather than from the chart: the source video, "The Best Strategy to Pass Prop Firm Challenges" by The Trading Academy, is built around the question of what holds up inside a funded-account evaluation — an account with a fixed profit target, a hard maximum drawdown and a daily loss limit. The title is a claim about a use case, not a measured performance result, and it is worth reading it that way.

That framing shows up most clearly in the timeframes. This is a Daily and 4-hour method, with entry conditions discussed on the 4-hour, and no intraday execution layer at all — unusual for a liquidity-driven approach, which on most channels descends to 15-minute, 5-minute or 1-minute charts to time the raid. Market structure is presented as fractal, so the two charts are not divided into separate jobs (one for bias, one for entries) but run the same structural read at two scales. The practical consequence is fewer setups, wider stops and multi-day holds, which is a coherent trade with an evaluation's daily-loss rule and an awkward one with its time limit.

The order in which the pieces are introduced is also telling. Fibonacci retracement comes first, used not to project targets but to split the range into premium and discount halves — a location filter that decides where a trade is even allowed to be considered. Structure follows, then supply and demand zones, which are qualified by their relationship to structure rather than drawn at every reaction. Liquidity arrives last, just before the entry segment, as a set of distinct types rather than a single event — the final layer over a map that fib and structure have already narrowed. No rule set was extracted for this entry, so this page covers the concept and how the video frames it rather than a step-by-step reconstruction.

Topics

fibonacci retracement strategy · market structure trading · liquidity trading · supply and demand strategy · smc strategy · eurusd trading strategy · gbpusd trading strategy · swing trading · price action strategy · forex strategy · 4-hour trading strategy · tradingview strategy · trading strategy · pine script

Frequently asked questions

What is a liquidity sweep in Smart Money Concepts?

A liquidity sweep is a move that pushes price through an obvious swing high or low where stop orders accumulate, triggering them before price reverses. SMC traders treat those levels as pools of resting orders and read the sweep as the market sourcing fills rather than as a genuine breakout.

Why would a liquidity strategy be traded on Daily and 4-hour charts?

Liquidity-based setups are most often shown on intraday charts, but the concept itself is timeframe-agnostic — swing highs and lows exist on every scale. The source video works on the Daily and 4-hour, which generally means fewer setups, wider stops and longer holds than an intraday version of the same idea.

How does Fibonacci retracement relate to liquidity and supply and demand?

In this kind of stack, Fibonacci is not used to pick targets. It divides a price range into a premium half and a discount half, so it acts as a location filter — a way of judging whether price is expensive or cheap relative to the leg being traded before any zone or liquidity read is applied.

Does passing a prop firm challenge require a specific strategy?

No single strategy is required. Evaluations impose risk constraints — a profit target, a maximum drawdown and usually a daily loss limit — so what a challenge really changes is position sizing, trade selection and how much variance an approach can absorb. Test any candidate on historical data first; Strategy Decoder extracts the structure of strategies from video sources so you can review and test them on TradingView.

About this strategy page

This trading strategy was decoded by Strategy Decoder's AI from a public YouTube trading video and turned into a structured, reviewable specification. In the interactive app this page shows the full entry and exit logic, risk management settings, the indicators involved with their parameters, AlgoWizard-compatible logic and a Pine Script export ready for TradingView backtesting — plus an automated backtest verdict when one has been computed for this strategy.

Strategy Decoder catalogs 2,229 decoded strategies. Each one is extracted with confidence scoring, cross-linked to the indicators it uses, and kept up to date as new videos are processed daily. Load this page with JavaScript enabled to use the interactive tools, or start from the strategy explorer to filter by methodology, market and timeframe.

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