Market Structure 📚

Few things are more important than understanding market structure. With that, it's very simple and being aware which trend the asset you're trading is in, can be very beneficial.

Higher Highs (HH) and Higher Lows (HL):

In an uptrend, the price forms successive higher highs and higher lows, signallish a bullish trend.

Lower Highs (LH) and Lower Lows (LL):

In a downtrend, the price forms successive lower highs and lower lows, indicating a bearish trend.

Market Structure Break (MSB):

A break in the trend (For example price failing to make a new high in an uptrend) may signal a potential trend reversal.

By determining which trend you're in, you can decide what trades to focus on. Bullish trend? Longs are more likely to work out and vice versa.

If you want more visual examples then you can check out the thread I wrote on market structure 👇