Advanced Market Structure

Swing Structure

  • Always present in market structure.
  • Can be analyzed from top-down or bottom-up.
  • The lesson will discuss when to start a pull from different points.

Internal Structure

  • Contained within the swing structure.
  • Can be visible on the same timeframe as the swing structure, especially during big moves.
  • May require dropping to a lower timeframe to identify.
  • Internal break of structure (BOS) indicates potential flip flops in market structure.
  • Shift in structure indicates the top/bottom of higher timeframe swing structure legs.

Fractal Structure

  • Contained within each leg of internal structure.
  • Multiple levels of structure exist within each leg.
  • Russian doll effect: open each doll to reveal another level of structure.
  • Potentially 10+ levels of structure from daily to 15-second timeframe.
  • Not necessary to analyze every level, trade what you're comfortable with.
  • Beginners may prefer swing structure due to longer trade times.
  • Advanced traders may use swing, internal, and fractal structures.

High Time Frame Analysis

  • Always start with high timeframe analysis irrespective of the asset to understand the overarching trend.
  • Determine current price position relative to the higher timeframe trend.
  • Example: Does the 4-hour move align with the daily, or the daily with the weekly?
  • Start with weekly or monthly charts for forex to gain perspective.
  • On the monthly chart of USD/CAD, price moved down, creating lower lows and lower highs, until a flip in monthly market structure occurred, signaling the start of an uptrend.

Range Bound Environments

  • After the break in market structure, the market entered a range-bound environment.
  • Price returned to a demand range mitigation area and then hovered.
  • Waiting to trade the monthly chart could mean waiting years.

Monthly Chart

  • The monthly chart indicates a newer uptrend, even though it's years old.
  • Only two breaks of structure.
  • Price came into a decent area for retracement, specifically an internal demand range.

Internal Demand Range

  • Last area with an up, down, and up pattern before a bigger break.
  • Another valid demand range may exist, but the internal one is more significant.
  • Price can drop to this level and still maintain a higher low for a monthly higher high.
  • Be aware of higher timeframe structure to avoid surprises during wonky structure flips.
  • Understanding the higher timeframe helps to avoid being blindsided.

Weekly Timeframe

  • Weekly timeframe exhibits similar structure, potentially identical swing structure to the daily.
  • Determine if a new structure drawing is necessary since macro swing structure might not be actively traded.
  • The structure between a specific point and the new higher high is analyzed.
  • Transition in market structure indicated potential bullish price action.

Topping Point

  • Aggressive expansion and transition in market structure from left to right on the weekly timeframe show the topping point.
  • Following the structure drawing, a lower high and lower low would be expected.
  • The process of making a lower low involves a transition in market structure from local bearish to bullish.

Ranges

  • Following an aggressive expansion away is very common to produce a range.
  • The high, low, and midpoint touch confirmed the range.
  • Deviation typically leads to rotation back up, confirmed by the flip in market structure.

Current Structure Analysis

  • Currently, losing a specific point on the weekly chart could lead to a drop to another level.
  • Higher timeframe analysis provides context for better decision-making on lower timeframes.
  • The market is quite rangy.

Drawing Structure

  • It is important to acknowledge previous structures for the decision making on how we are going to be pulling our structure on the mid to low timeframes.
  • If you don't start in the high time frames first you could end up with a mess.

Daily Timeframe

  • Determine if continuing the same drawing makes sense or if marking a weekly internal high or low is sufficient.
  • Focus on the area between key points on the weekly structure drawing.
  • Important to retain awareness of the higher timeframe structure to avoid being caught off guard.

Daily Swing Structure

  • The market moved up, then down, then up again, making higher lows and highs before breaking structure for a lower low.
  • A break in daily structure is normal for price to get to a retracement point.
  • Watch for mitigation of the previous demand range.

Market Trend

  • Overlapping that structure drawing one more time.
  • The mitigation from the previous demand range didn't follow through with more initiation.
  • Bearish market structure is evident so far from top down to the daily timeframe.
  • The bearish daily structure could overpower the weekly structure, leading to a flip in trends.

Fractal structure

  • Exists all over the place.
  • There has to be a downwards trend between point a and point b.

Macro Swing Structure

  • Macro swing structure, internal structure.
  • Be aware that there are multiple pulls and it doesn't matter what you call it if you can identify the different pulls.

Internal Daily Structure

  • Dissect structure from a high point downwards, then down to a lower time frame.
  • Level of internal structure exists between identified key points.
  • Breaking a high with a convincing close in a supply zone suggests an upward movement towards at least the defined points.
  • A market structure shift would indicate the identified point as a weak high and a sufficient target, but this has to occur.

Market Logic

  • The technical target would have absolutely been this high.
  • Base your altercations on logic.

Shifts in market structure

  • A potential shift in market structure that did not quite happen just yet.
  • Wicks instead of candle body closure indicates a weak low based on wick-based theory or swing failure pattern theory.
  • Shifts in structure are confirmed by shifts in structure.

Staircasing brachistructure

  • If you're staircasing a brachistructure, then obviously the high point would be the safer bet, otherwise the better would be that guy, right there.
  • Unable to identify market structure between internal swing high and low.

12 hour window

  • Use a highlighter to dab out each point of the twelve hour window to highlight fractal structure.
  • This is known as Fractal 1 Structure.
  • There are going to be many levels here.
  • Analyze this leg too see what we end up with.

4 hour and 2 hour

  • Break structure finally, and identify that guy as a weak high.
  • With this fractal pull that if you were to continue on with this drawing, there is no higher low to break to justify this as a weak low.

Internal Timeframe

  • We have the fractal one, we have the internal, and we have the swing timeframe.

Two-Hour Timeframe Analysis

  • The 2-hour timeframe reveals a small change between the high and the low.
  • The 4-hour structure didn't originally translate to a 2-hour break, showing its importance.

Additional Notes

  • This indicates that we had the initiation out of this range.
  • Look more for shorts right here at this moment if you're gonna watch trades.

Possible outcome of a trade based on short position.

  • If structure comes out like this, with a bullish break from left to right, that may indicate it is time for a higher low and higher high.
  • It may indicate that it's time for the higher low to be put in place based on this structure.
  • The fractal order block with imbalance followed.

In Conclusion

  • Start on higher time frames to see the market structure.
  • Investigate the ideas further and further to see what steps need to be taken to continue along.
  • If we break through structure bearishly on that swing we want to investigate what happened between those areas to get a better look on trades to come.