📊 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.
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