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Breakofstructure

How to Find a High Probability Trade in an Uptrend Hey Traders, We'll show you how you can find an easy trade with a high risk-to-reward ratio using some basic concepts. - Step One: Spot an uptrend where you have higher highs and higher lows. - Step two: Spot the last break of structure. - Step three: Use the Fibonacci tool and connect it from the recent lows to the recent highs. - Step Four: Watch prices coming back to the broken structure that lines up with any Fibonacci level. ( Focus on the 50% - 61.8% - 78.6% Levels ) - Step Five: Wait for a clear bullish candle and then enter with stoploss structure - Step Six: Take partial profits at the recent highs and the Fibonacci extensions ( - 0.27 & -0.618 )
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by Tradenessfx
3
A guide to Profitable Scalping (why waste a price action)In the world of trading, many participants find themselves constantly waiting for the perfect confirmation for swing positions or entries, often missing out on the rapid movements that characterize financial markets. This is where the art of scalping comes into play, a strategy vastly different from swing trading, yet equally, if not more, compelling for those who master it because it offers way more opportunities to make money. In this blog post, I'll guide you through the essentials of becoming an effective scalper, focusing on market structure theory, the significance of Break of Structure (BOS), and the nuances that set scalping apart from swing trading. Understanding Market Structure Theory To excel in scalping, one must first be well-versed in market structure theory. This theory is the backbone of understanding how markets move and why they behave in certain patterns. It involves analyzing price highs and lows, trends, and ranges to predict future price movements. For a comprehensive understanding of market structure theory, this resource offers an in-depth explanation, it's not complete, but the best one freely available so I suggest you understand the content properly. www.youtube.com The Role of Break of Structure (BOS) A critical concept in scalping is the Break of Structure (BOS). When we observe a confirmed BOS to the upside or downside, it indicates a significant shift in market sentiment. The order block that caused this break becomes a focal point of interest. This is because, in the realm of scalping, these points often act as magnets for price, offering high-probability entry points. Capitalizing on Order Blocks Once a BOS is identified, scalpers must pay close attention to the order block that instigated this shift. When the price returns to this order block, a reaction is typically expected. This reaction is the bread and butter of scalping. Unlike swing traders who seek to capture larger market moves over extended periods, scalpers thrive in these quick, precise moments. Scalping vs. Swing Trading: A Different Focus The primary difference between scalping and swing trading lies in their respective focuses and timeframes. Swing trading involves holding positions for several days to weeks, aiming to profit from substantial price moves. Traders in this domain often focus on potential targets for a trade, analyzing broader market trends and economic factors. Conversely, scalping is a short-term strategy where trades last from a few minutes to hours. The focus here is not on the potential extent of a price move but, on the risk, -to-reward ratio. Scalpers typically aim for a 1 to 3 risk-reward ratio, meaning they risk one unit to gain three. This approach requires quick decision-making so it's much more involved than swing trading. Before we go on to see some examples following are the key things to remember to be effective in scalping To be an effective scalper, you need to: 1. Develop a proper Understanding of Market Structure 2. Identify High-Probability Order Blocks 3. Master Risk Management: Given the high-speed nature of scalping, managing risk is paramount. This involves setting strict stop-loss orders and having a clear risk-to-reward ratio for each trade. 4. Stay Disciplined and Agile: Scalping requires discipline to follow your trading plan and agility to adapt quickly to changing market conditions. Examples: Scalable OBs with results. This happened today: on SPX and NAS100 NAS100: SPX: How to pick an order block to trade for scalping: Entry for Scalping should be between 0.25 to 0.5 level inside the Order Block, you can use FIB tool to get these levels, this is highlighted in the Images above. 1. Do not go above 4h TF for this strategy. 2. Make sure Order block is caused a BOS 3. Notice the time frame of BOS, Pick the Order block in relation to the BOS timeframe. 4. Makes sure Prior to BOS the Order block resulted in FVG 5. Make sure the Order Block is not too big as it will result in greater risk, which I do not prefer. 6. If price does not hit your entry do not chase price, move on to next one. I want to emphasize here again , the goal of scalping is to capture the small move , not the whole move , so your focus should be one getting 2X or max 3X of your trade once , you do you get out and move on to next one , the good thing about this strategy is you can always find multiple assets where BOS is happening on anywhere from 1h to 4H TF. Finally, nothing in the world of trading is 100% so it's possible this may not work sometimes, which you should be okay with as long as it works more than 50% of the time. I n my experience it works more than 80% of the time. Conclusion Scalping is a dynamic and potentially lucrative trading strategy that requires a unique skill set, distinct from swing trading. By understanding market structure theory, focusing on order blocks following a BOS, and maintaining a disciplined approach to risk management, traders can exploit the rapid movements of the market for steady income. Remember, the key to successful scalping lies in quick, informed decisions and an unwavering commitment to your strategy. Like and Leave comment to this post to seek further clarifications if needed. Happy trading!
Education
by zakoraio
📊 Market Structure: BOS VS CHOCH📊What is market structure? Market structure is the levels that are created by the price of any currency as it moves up and down. Price never moves in a single direction for too long. It always takes a few steps in one direction, then moves a few steps back, then a few more steps, then a few steps back. Over time, these steps form distinct structures in the market: zones of consolidation, zones of support, zones of resistance, and zones where price impulses up and down. Market structures that form in the past are often respected in the future, and analyzing previous market structure can form a basis for a trading plan. BoS carries on in the same direction it was initially heading in where as a CHoCH can be viewed as the Markets turning point 🔷BOS - Break of structure forms in the direction of the trend creating continuation patterns. Break of recent Lower Low when bearish or break of recent Higher High when bullish. 🔶CHOCH - Change of character form at the end of a trend. For example, if we see an uptrend in the market, characterized by higher highs and higher lows, this means that the overall trend remains bullish. However, when a new high is formed and then impulsively broken to the downside, this could signal that the bullish trend might be coming to an end, and that a possible choch transition may be happening. 👤 @algobuddy 📅 Daily Ideas about market update, psychology & indicators ❤️ If you appreciate our work, please like, comment and follow ❤️
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by QuantVue
7
CHOCH vs BOS ‼️WHAT IS BOS ? BOS - break of strucuture. I will use market structure bullish or bearish to understand if the institutions are buying or selling a financial asset. To spot a bullish / bearish market structure we should see a higher highs and higher lows and viceversa, to spot the continuation of the bullish market structure we should see bullish price action above the last old high in the structure this is the BOS. BOS for me is a confirmation that price will go higher after the retracement and we are still in a bullish move WHAT IS CHOCH? CHOCH - change of character. Also known as reversal, when the price fails to make a new higher high or lower low, then the price broke the structure and continue in other direction.
OANDA:XAUUSDEducation
by Snick3rSD
2
Viewing Break of Market Structures as Broken ExpectationsBreak of expectations is a perspective from which I look at market moves a lot of the time. Broken expectations manifest in the form of broken structures. It's the same thing, but just another way of looking at such moves which makes the liquidity story a bit clearer thereby inducing more confidence in taking trades off these zones. Obvious trend continuation zones, when broken, catch many a trader offside. These make for high probability trade locations (for trades in the opposite direction).
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by the_MarketWhisperer
1
Market Structure - The Chart analysis (simplified!!!)Using Market Structure to identify entries in the FX market has been a life changing technique for me. Through this video, i described my process of entering trades using MS without a single indicator in sight!!! You'll see the following : 1. How to draw support and resistance. 2. How to identify the trends in a market ? What is a Break of Structure ? 3. Avoiding fake outs using the Law of 2's (by waiting for two consecutive HH's and HL's | LH's and LL's). 4. What is a Major Level ? Is it really useful to my analysis? 5. How to determine Take Profit using MS.....etc
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by TemiTola
Backtesting retest Break of Market Structure on Multi TimeframeStrategy Create a zone from the order block which created break of market structure on 1D timeframe Wait for it to be tested on 4H timezone => which will create new 4H order block Trade the retest of that 4H order block Color coding & icon use Green boxes : 1D order block zone Yellow boxes : 4H order block zone Tick icon : Trade won on 4H Cross icon : Trade lost on 4H Circle with cross icon : Trade in breakeven Win / loss assumptions Win : 3R movement without breaking -1R Loss : -1R movement Breakeven : 1R movement, followed by -1R movement Risk Management 50% TP @ 1R 25% TP @ 2R 25% TP / Trade closure @ 3R RR achieved = 3R Net R achieved = 1.75R Strategy results Testing duration : Jan 2020 - Jan 2021 Wins = 16 Loss = 7 Breakeven = 4 Non-losers = 74% Absolute Winners = 59% Net RR = 21 Avg R/Win = 1.31R Avg R/Trade = 0.78R
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by makuchaku
8