Liquidity is a derivative of the interaction between:
Mostly Human traders & the markets, facilitated & operated by algorithms on behalf of Market Makers.
This interaction creates data, you can either acquire the data directly through a source you deem to be reliable & high enough resolution
Or, you can come to the conclusion on your own by understanding the interaction between Retail Traders & Market Makers.
All Humans react to emotion, this is why the markets are able to galvinize Retail into picking the wrong side
One side offers significantly higher returns, erecting greed among Human Traders to entice them to pick that side.
While the other side may offer more moderate returns, but is far more logical.
Most traders being human, react to fear, greed, and many other emotions, and through that psychological warfare..
They are manipulated into choosing the wrong side.
To conclude:
Yes, you can acquire reliable data regarding the liquidity in the markets by interpreting the psychological reactions human traders experience observing & trading candlesticks.
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I have to disagree on this,
Liquidity is a derivative of the interaction between:
Mostly Human traders & the markets, facilitated & operated by algorithms on behalf of Market Makers.
This interaction creates data, you can either acquire the data directly through a source you deem to be reliable & high enough resolution
Or, you can come to the conclusion on your own by understanding the interaction between Retail Traders & Market Makers.
All Humans react to emotion, this is why the markets are able to galvinize Retail into picking the wrong side
One side offers significantly higher returns, erecting greed among Human Traders to entice them to pick that side.
While the other side may offer more moderate returns, but is far more logical.
Most traders being human, react to fear, greed, and many other emotions, and through that psychological warfare..
They are manipulated into choosing the wrong side.
To conclude:
Yes, you can acquire reliable data regarding the liquidity in the markets
by interpreting the psychological reactions human traders experience observing & trading candlesticks.