Market Structure: Seeing In Swings

Market Structure is simply making distinctions in price flow. its putting structure around what looks like chaos so that we have a way to measure and orient ourselves to any market in any timeframe. When I look at a market, I want to see objectively in swings.

Swings are the common thread that weaves through all markets and timeframes, clearly indicating who is in control at any given moment. They consist of distinct components and follow a process, forming the foundation of my trading strategies and setups.

Market Structure Definitions:

Confirmed Swing High/Low: A new high confirms a
swing low and a new low confirms a swing high.

Major Swing: The largest reaction leg in your frame.
Minor Swing: the next largest reaction leg.

Balanced/Relative Swing: Same size reaction legs.

Expanded Swing: Reaction leg larger than previous reaction leg.

Components of a Swing:

Impulse Leg: The leg that takes out a previous high or low.

Reaction Leg: The retracement or pullback after the impulse leg.

Impulse Leg Shelf: a small range at the end of an impulse leg

Reaction Leg Shelf: A small range at the bottom of a reaction leg

Seeing In Swings

We want to learn to see and experience the market in swings. This gives us a clean and consistent look without all the baggage we add to markets. Swings have a process and components that make up that process. These are the building blocks we used to design methods and setups that will become part of a consistent trading plan. In this video, I teach you how to map any market with swings and to identify the process and components that make up the swing. This is foundational and is always our first step when looking at a market.

Design Your Own Trading Methods

This is the first part of a series on how to design your own trading methods. These methods can be from what you have observed in price flow, or they can be methods you have learned and want to adapt to your needs the way you see. It’s beneficial for us to participate in the authorship of the trading methods we use, and to make them ours.

Whatever we design will have to adhere to the principles of price flow. For example, everything moves in contraction/expansion and all market structure is a derivative of gaps and swings. From this observation, we can start to build on solid foundations and come up with numerous methods.

In this video, I want us to get a solid understanding of how price moves in a swing cycle. A swing moves in process and each part of the process has its own components and characteristics. If we understand this, we can design methods and tactics for various parts of that cycle.