Core logic summary – how it decides what is what

1. Detects swings using classic fractal logic (SwingStrength bars left + right)
2. • Default = 5 → reasonably clean swings on most timeframes
2. Determines trend from the last two highs + last two lows:
3. • HH + HL → Bullish trend
   • LH + LL → Bearish trend
3. BOS / CHoCH detection (on close):
4. • Close > previous swing high
   • • If trend was bullish → BOS (continuation)
     • If trend was bearish → CHoCH (potential reversal)
   • Close < previous swing low → opposite logic
4. Liquidity sweep (very common SMC pattern):
5. • High wick above last swing high but close below it → bullish sweep (likely fakeout up)
   • Low wick below last swing low but close above it → bearish sweep

Typical SMC trading usage of such an indicator

• Look for CHoCH + liquidity sweep in the opposite direction → early reversal setups
• Trade in direction of BOS after a pullback / sweep
• Avoid trading against the structure shown by HH/HL vs LH/LL labels
• Many traders wait for sweep → CHoCH/BOS confirmation sequences