Market Structure Confirmation

[Westbruno]

Hi everyone,

I would like to know if this is a market structure break CHOCH, yes or no and why? or why not.

Which one are correct? even though the market is already showing somehow.

thanks.

Thanks again

 

[tomorton]

There isn't an absolute right or wrong with TA like this on a chart. The chart is evidence of what the the market has done, not of what it will do next. What you call the price action - whether you call it a ChoCh or something else - is your subjective analysis. It's not universal, but it can be very useful for you to guide your trade decision-making.

If you're following someone else's rules that feature ChoCh in their strategy, then that strategy should define what price action looks like in order to show a ChoCh. If the strategy is ambiguous or too complex to use safely, change strategies.

 

[Westbruno]

Thank you for your reply - I hear you - but lets find out if this one is good or not - what is your strategy?

thanks

 

[tomorton]

Most of my trades are long-term trend-following - basically, the old technique of buy on the dips. I run some shorter-term trades based on Smash Day candlestick set-ups.

 

[Westbruno]

I guess, on weekdays the pattern looks better, compare to the weekends ones - little messy though.

 

[Westbruno]

This one did not plat out - the Choch wasnt really convincing anyway - right at New York Open also...

 

[Arya cryptocurrency]

Market Structure Confirmation: Key Considerations


Confirming the market structure is essential for making informed trading decisions. It involves analyzing price action, trendlines, and swing points to determine whether the market is in an uptrend, downtrend, or ranging phase.


Key aspects to consider include:

1. Higher Highs and Higher Lows (Uptrend): Look for a series of higher highs and higher lows to confirm bullish market conditions. Conversely, lower lows and lower highs indicate a bearish trend.
2. Trendline Validation: Drawing trendlines connecting swing lows or highs can help visualize the prevailing trend. Valid breakouts or breakdowns of these trendlines often signal potential shifts in market structure.
3. Swing Points and Price Reactions: Identifying significant swing points and observing how price reacts around support and resistance levels adds confirmation to the current structure.
4. Volume and Momentum Indicators: Supplementing price analysis with volume and momentum indicators like RSI or MACD can provide additional confirmation of trend strength or potential reversals.

Practical Approach:

• Wait for price to establish clear swing points.
• Confirm the direction with multiple timeframes if possible.
• Use price action signals (e.g., rejection candles, breakouts) in conjunction with trendlines and swing analysis.
• Be cautious of false breakouts; always seek confluence before acting.

Conclusion:


Market structure confirmation is about aligning multiple signals to validate the current trend or range. Patience and disciplined analysis are key to avoiding premature entries and ensuring higher probability setups.

 

[RolloTape2025]

What is a Choch?

 

[Rufus_Leakey]

What is a Choch?

Change of character.

In trading, "CHoCH" refers to a Change of Character, which is a technical observation indicating a potential shift in market dynamics, suggesting a possible trend reversal. It signals a fundamental change in market sentiment, indicating a weakening of the current trend and potentially a reversal on the horizon.

Here's a more detailed explanation:

• What it is:
  A CHoCH occurs when a market deviates from its expected behavior, suggesting a shift in the prevailing trend.
  
  
• How it's used:
  Traders use CHoCHs to identify potential trend reversals and adjust their trading strategies accordingly.
  
  
• • Examples:
    In a bullish trend, a CHoCH might occur when the price fails to make a new high and falls below a recent higher low, indicating buyers are losing control. Conversely, in a bearish trend, a CHoCH might occur when the price unexpectedly breaks above a recent lower high, suggesting sellers are losing control.
    
  • Importance:
    Identifying CHoCHs early can help traders anticipate potential trend reversals and adjust their positions accordingly.
    
  • Relationship to Break of Structure (BOS):
    While both CHoCH and BOS can indicate potential trend reversals, BOS focuses on trend continuation rather than a change in direction. A CHoCH, on the other hand, signals a fundamental shift in market sentiment.

 

[RolloTape2025]

Change of character.

Thankyou Rufus, I would never have guessed that in a million years