MARKET STRUCTURE
How to use market structure to identify order blocks.
Today's PDF we will go over market structure and how to identify order blocks.
We will use 1 timeframe and solely use this PDF to identify those order blocks
without any refinement whatsoever.
We will use this area of the chart for today's examples.
MARKET STRUCTURE
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Lets just use this area so as not to confuse the example. This market structure is
pretty clean so a nice example. Here we can clearly identify price making higher
highs, higher lows, and then changing trend making lower highs and lower lows.
Lets use the change in trend as our example to identify a clean order block.
MARKET STRUCTURE
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This is what we are trying to achieve when looking for change in trend which
actually in my opinion gives us the best chance of hitting high RR. When price is
in an uptrend it isn't going to move up forever, it is travelling to a target and
every time it moves its moving closure and closure to that target so the RR
reduces. Catching price within that clear and clean break of trend it has reached
its target or POI and is now moving back to another (supply and demand, buyers
to sellers) so you have huge potential to hit really good RR.
Here we see our change in trend. This is the 1H timeframe so the potential on this
timeframe doesn't look amazing but imagine an entry here on the 1M based off
1H bias? But we wont cover that today as I want to keep it as simple as possible.
We can clearly identify price broke previous low and was unable to break
previous high. We now have a change in trend and a strong order block created
due to price breaking structure to the downside.
MARKET STRUCTURE
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Zooming into the area we can clearly see our break of structure and order block.
Lets assume i have slightly refined this order block but you can see price tap into
it before moving down. And as it moves down it taps into further order blocks
until again changing trend. If you followed this chart on a higher timeframe to
avoid lower timeframe confusion and identified this change in trend all you simply
have to do is wait for price to approach, refine your order block down to 1M or
even 5M and then use your knowledge of Wyckoff to help give you confluence
that this is a confirmed change in trend and price will continue down, giving you
huge potential with regards RR.
I hope this PDF helps anyone who is wondering about market structure etc. Not a
very long one today but I feel market structure is important and just wanted to
share how I view it within the markets in the hopes that it may help somebody.
THIS IS HOW I PERSONALLY VIEW THE MARKET AND DOES NOT REFLECT
mentfx STYLE OR COURSE CONTENT. MY VIEWS MAY BE COMPLETELY WRONG
OR COMPLETELY RIGHT BUT IT WORKS FOR ME AND I HOPE IT WORKS FOR
MARKET STRUCTURE
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SOMEONE ELSE BUT IF YOU DO NOT LIKE WHAT YOU SEE JUST MOVE ON AND
KEEP DOING YOUR THING
MARKET STRUCTURE
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