The London Sweep is a high-probability setup that occurs during the European session open. It capitalizes on the tendency for London traders to sweep the Asian session range before establishing the real directional move for the day.
The Concept
During the Asian session, price typically consolidates into a range. Liquidity builds above the Asian high (buy stops) and below the Asian low (sell stops). When London opens, institutions often sweep one side of this range to grab liquidity before moving in the opposite direction.
This creates a predictable pattern: sweep Asian high, then sell off. Or sweep Asian low, then rally. The London Sweep setup captures this reversal.
Setup Requirements
1. Clear Asian Range: A defined range during Asian session (6 PM – 2 AM ET). The range should be relatively clean with clear high and low. Very tight ranges may not provide enough liquidity.
2. London Session Timing: Setup occurs during London open (2-5 AM ET). Best results in the first 1-2 hours of London session. Too late in London and the opportunity may have passed.
3. Sweep of Asian Extreme: Price must break beyond the Asian high or low. This sweep grabs the resting liquidity. The sweep should occur with some conviction but does not need to be large.
4. Rejection After Sweep: Price must show rejection after the sweep. Look for: reversal candle, lower timeframe CHOCH, or Order Flow rejection.
5. Entry on Confirmation: Enter after confirmation of reversal. Do not anticipate the rejection—wait for it to occur.
Long Setup Rules
Context: Price sweeps the Asian low during London open.
Entry Trigger: After sweep of Asian low, wait for bullish confirmation. This can be: a bullish engulfing candle, a lower timeframe (1M or 5M) CHOCH, or strong buying appearing on Order Flow.
Entry: Enter long after confirmation.
Stop Loss: Below the sweep low with a small buffer (3-5 points on ES/NQ).
Target: First target: Asian session high. Second target: Previous day high or next liquidity level.
Short Setup Rules
Context: Price sweeps the Asian high during London open.
Entry Trigger: After sweep of Asian high, wait for bearish confirmation. This can be: a bearish engulfing candle, a lower timeframe CHOCH, or strong selling appearing on Order Flow.
Entry: Enter short after confirmation.
Stop Loss: Above the sweep high with a small buffer.
Target: First target: Asian session low. Second target: Previous day low or next liquidity level.
Order Flow Enhancement
Add Order Flow for higher probability:
On the Sweep: Look for aggressive activity (stops being triggered). The sweep should show volume and momentum.
On the Rejection: Look for absorption at the extreme. Stacked imbalances in the reversal direction. Delta shift from sweep direction to reversal direction.
Order Flow confirmation significantly increases setup reliability.
Example Trade Walkthrough
Setup:
Asian session (6 PM – 2 AM ET) formed a range from 4500 to 4520 on NQ.
At 2:30 AM ET (London open), price drops sharply to 4495, sweeping the Asian low at 4500.
On the 5M chart, a strong bullish engulfing forms at 4497.
Footprint shows stacked buying imbalances on the rejection.
Execution:
Enter long at 4505 (after engulfing closes).
Stop at 4492 (below sweep low with buffer).
Target 1 at 4520 (Asian high).
Target 2 at 4535 (previous day high).
Management:
Take 50% at Target 1.
Move stop to breakeven.
Let remainder run toward Target 2.
When to Avoid
Very Wide Asian Range: If the range is unusually large, the sweep may be a genuine breakout rather than a liquidity grab.
Strong Trend Context: If higher timeframe is strongly trending in sweep direction, the sweep may be continuation rather than reversal.
Major News Pending: If significant news is due during London session, patterns may not play out normally.
No Clear Sweep: If price just drifts through the Asian level without conviction, there is no sweep and no setup.
Statistics and Expectations
With proper execution, the London Sweep setup typically offers:
Win rate: 55-65% with proper filtering. Average R:R: 2:1 to Asian range extreme, higher with extended targets. Frequency: 2-4 setups per week in index futures.
Track your own statistics as you trade the setup.
Key Takeaways
The London Sweep capitalizes on European session sweeping Asian range liquidity. Wait for the sweep of Asian high or low during London open (2-5 AM ET). Require confirmation of reversal before entering. Stop goes beyond the sweep with buffer; target is opposite range extreme and beyond. Order Flow confirmation (absorption, stacked imbalances) increases probability. Avoid when Asian range is too wide or strong trend favors sweep direction.