CryptoSoulz

In this COMPLETE THREAD I will explain “Market Structure”

1. What is Market Structure?
2. Bullish Market Structure 
3. Bearish Market Structure  
4. Break of Structure (BOS) 
5. Change of Trend 
6. Change of Character
7. Possible SHORT setup

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1. What is Market Structure? 

Understanding market structure (MS) would help you as a trader to spot bullish or bearish trends. 

MS is a continuos series of HH (Higher High) and HL (Higher lows) on a Bullish MS. 

And LH (Lower high) and LL (Lower Low) on a Bearish MS. 

2. Bullish structure

Bullish MS is a succession of HH and HL as you can see on the 1 pic. 

We can identify a bullish trend by watching 2 or more HH's on chart and HL (watch 1 chart) 

3. Bearish Market Structure:

Is a succession of LH and LL. When we identify 2 or more LH and LL on chart, we usually on a downtrend. 

(The higher TF we use, the "safer" is that trend) 

3.1 Bullish &amp; Bearish MS:

Bullish Ms formed by: HH and HL
Bearish MS formed by: LH and LL

Always relay in HTF Market structure before LTF.

My preferred TF to identify Market structure:
Daily and 4H 

4. Break out of Structure

BOS occurs when in an uptrend price forms HH and HL.

BOS also occurs when in a downtrend price forms LH and LL

My preferred TF to identify BOS is Daily and 4H.

The failure to create a BOS results in a change of trend. 

5. What is a "Change of trend"

Price can't be forever Bullish or Bearish. The trend changes when there is a failure to respect BOS.

If you are viewing a 4H MS, you must anticipate a trend change from a Daily PD Array. 

6. Change of Character

It's basically a trend change/MS Shift on LTF.

CoC is basically used for execution. If you are seeing 4H MS, use 15/5 minutes TF.

Two requirements for valid Change of character:

- Displacement
- Candle closure 

7. Possible SHORT and LONG Scenarios

There are 2 possible short scenarios in a Bearish MS

Scenario 1:

Buyside Liquidity at previous high not taken, SHORT when price arrives the OB

Scenario 2:

Buyside Liquidity at previous high taken. 

Short in Liquidity hunt/Deviation 

In this THREAD I will explain “Liquidity”

1. IFVG 
2. Killzones 
3. POI 
4. PO3

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1. IFVG

Inversal Fair Value gap is a significant imbalance area.

Which indicates potential price trend reversals in the price.

IFVG forms when an FVG is invalidated by a candle wick or close. 

1.1 IFVG

Inversion Fair Value Gap appears when a bearish FVG is CLOSED above and becomes support.

Also when A bullish FVG is CLOSED below and becomes resistance. 

2. Killzones

The Asian Forex trading session takes place primarily in the Tokyo market.

Opens at 00:00 PM and closes at 09:00 AM GMT.

This session has relatively low volatility compared to the London and NY sessions.

Due to lower liquidity and lower price fluctuations. 

2.1 Killzones

London opens at 8:00 AM and closes at 5:00 PM GMT

London Trading Session has high volatility and liquidity. 

This is because of the presence of institutional traders, hedge funds and banks. 

2.2 Killzones

The New York session lasts from 13:00 PM to 22:00 PM GMT

The New York forex session is normally the second-most liquid session. 

It overlaps with London, and this is considered to be the most liquid period of the day. 

2.3 Killzones

Killzone: The period during which the Asian session is most volatile, is between 11 pm and 3 am (GMT)

In reality, the kill zone (peak volatility) at this time is mainly due to the opening of the Tokyo session. 

2.4 Killzones

The London Killzone occurs shortly before the opening, at 7:00 AM and ends at 9:00 AM (GMT)

Once liquidity is captured in the Killzone, the highest or lowest point of the day is often established.

This phenomenon is generally respected most of the time. 

2.5 Killzones

The New York Killzone is therefore located slightly before the opening of the American session, from 12:00 PM to 2:00 PM (GMT)

The New York Killzone begins even before the session opens, as investors speculate on the direction the market will take once it opens 

3. POI

A POI (Point of Interest) is a key price level or zone on a chart that traders monitor for potential reversals, breakouts...

It’s often based on historical Support/Resistance or Market Structure. 

3.1 POI

In these charts, Key Supply zones (shaded areas) align with potential POIs.

While the wicks at Highs/Lows hint at liquidity pockets.

Price retests these areas, making them prime for watchful traders anticipating reversals or breakouts. 

3.2 POI

POIs pinpoint key price levels where traders have historically reacted, marking Support/Resistance zones.

They help forecast reversals or breakouts, guiding Entry/Exit decisions and enhancing risk management in chart analysis. 

4. PO3

The Power of Three is divided into three phases: 

Accumulation, Manipulation, and Distribution

This trading setup helps to build narrative, as well as spotting important institutional levels 

4.1 PO3

1. Accumulation: Smart money quietly build their positions without causing a price increase  

2. Manipulation: Institutions push prices to trigger stops

3. Distribution: Smart money begins to sell their accumulated positions to retail at higher prices 

In this THREAD I will explain "FVG"  

1. What is a “FVG”
2. Strongest FVG
3. How to identify FVG
4. IFVG

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1. What is a "FVG"

Fair Value Gaps are imbalances caused in the price, which will eventually be fulfilled.

It occurs when the market leaves behind untraded price levels due to strong buying or selling pressure. 

1.1 What is a "FVG"

A Bullish FVG forms on a second rising candle between the high of the 1st candle and the low of the 3rd candle, without any overlap

A Bearish FVG forms on a second declining candle between the low of the 1st candle and the high of the 3rd candle. 

2. Strongest FVGs

- A FVG becomes stronger when:

The FVG overlaps with each other (Balanced Price Range BPR)

After change in State of Delivery (CISD) 

2.1 Strongest FVGs

When there's a FVG created in HTF, it becomes High Probability.

Timeframes to pay attention to be in Sync:

1H FVG -&gt; 5m FVG
4H FVG -&gt; 15m FVG
Daily FVG -&gt; 1H FVG 

2.2 Strongest FVGs

A FVG that aligns with the True Day Open is a High Probability FVG.

This level will act as a very strong Support or Resistance level. 

2.3 Strongest FVGs

When a FVG leads to a creation of a Market Structure Shift, it becomes a strong FVG.

The candle has to close above the Swing High in order to be valid. 

3. How to identify FVG

In this Bitcoin chart, all the FVG's are illustrated through an Indicator.

You can identify also FVGs:

- Use HTF to identify the more reliable setups 

 - Look for impulsive moves (strong directional trend with volume) 

3.1 How to identify FVG

- Mark the imbalance zones (this area will represent the FVG)

- Wait for a price reaction into the FVG

- Must have surpassed previous  FVG's

- Consecutive FVG's in the same direction 

4. IFVG

An Inversion Fair Value Gap is formed when a fair value gap is invalidated, by a candle wick or close.

These areas can indicate a shift in the market’s momentum, indicating a potential reversal in the market’s trend. 

4.1 IFVG

A Bullish IFVG is found by locating a Bearish FVG.

Once the Bearish FVG is invalidated or broken, it's considered a Bullish IFVG.  

When price comes back to a Bullish IFVG, you can use the zone as an area for potential long trade entries. 

4.2 IFVG

A Bearish IFVG is found by locating a Bullish FVG.

Once the Bullish FVG is invalidated or broken, it's considered a Bearish IFVG.  

When price comes back to a Bearish IFVG, you can use the zone as an area for potential short trade entries. 

4.3 IFVG

In this trade, a bullish liquidity grab was detected by the Liquidity Grabs indicator.

Price shot up, invalidating the bearish FVG and forming a bullish IFVG. 

Once the IFVG is formed, you can set your Stop Loss below the IFVG and take a 1:2 risk-to-reward trade 

In this THREAD I will explain “Liquidity”

1. Liquidity Sweep
2. PO3
3. Volume

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1. Liquidity Sweep

A Liquidity Sweep occurs when large market participants activate significant orders within Liquidity Zones.

This causes rapid price movements 

1.1 Liquidity Sweep

Liquidity Run occurs when the price moves in the direction of the prevailing trend.

Liquidity Run refers to a situation where the market price moves persistently in a single direction, consuming or "sweeping up" liquidity along the way. 

1.2 Liquidity Sweep

A Liquidity Sweep targets a specific level to trigger stop orders and cause a reversal.

A Liquidity Run moves in one direction without reversing gathering Liquidity before making a major move.

It is seen as a continuation of the short term trend. 

1.3 Liquidity Sweep 

In a Bullish trend, a Liquidity Sweep is when price dips below a swing low, trapping sellers before reversing up.

A Liquidity Run is when price breaks above a Swing High, signaling continuation higher.

HTF trends are easier to identify than LTF 

2. PO3 

It dissects market movements into 3 distinct phases:

Accumulation, Manipulation and Distribution 

2.1 PO3

The Accumulation or Consolidation phase is the first step of the Power of Three.

Where institutional traders begin to build their positions without causing major price moves.

This phase typically occurs in a period of consolidation or range-bound trading 

2.2 PO3

"Distribution Zone" refers to the phase where market manipulation by institutional traders begins to distribute their accumulated positions. 

This phase is characterized by price movements in the opposite direction of the initial manipulation. 

2.3 PO3

Manipulation is where price deliberately move in a false direction to trick traders into taking the wrong position or getting knocked out of their positions

This phase is seen as being characterized by sharp, misleading price movements aimed at manipulating liquidity. 

2.4 PO3

Bearish PO3 is conformed by:

1. Accumulation: The price enters in a range

2. Manipulation: The price aggressively rallies above the range, creating liquidity above last highs

3. Distribution: Price expands downwards, breaking the MS with strong bearish candles 

2.5 PO3

Bullish PO3 is conformed by

1. Accumulation: Longs are building up and price is in a range

2. Manipulation: Market sells of below the range, creating liquidity

3. Distribution: Price expands upwards, breaking MS with strong bullish candles and bullish volume 

3. Volume

When you are trading using Volume, understanding how to differentiate a true breakout from a Fakeout is crucial.

Fakeouts is where a price breaks through a Support or Resistance Level but then reverses back. This can trap traders who enter too early. 

3.1 Volume

How do you know if a breakout is false?

Using certain Indicators such as RSI, MACD or CVD will help you identify a reversal.

Volume is the key in identifying the strength of a trend.

Measure the volume that is flowing in a chart, to know if its a breakout or not. 

3.2 Volume

Stop hunting is when the volume and price change during trading, triggering Stop Losses that drive up volatility.

Low volume during a breakout attempt often signals a lack of market conviction, making it more likely that the breakout will fail. 

3.3 Volume

If a Bullish Breakout is driven by Stops being triggered and not new willing buyers, breakout is going to fail.

In a Bearish Breakout, if no new sellers are trading the breakout, what will drive price lower?

Fakeouts are nearly always accompanied by stop hunting. 

In this THREAD I will explain “Liquidity”

1. Where is the Liquidity?
2. Liquidity Sweep
3. Premium and Discount

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1. Where is the Liquidity?

Liquidity concentrates around Order Blocks and Breaker Blocks, where institutional orders accumulate. 

Order Blocks define Supply and Demand zones.

Breaker blocks signal control shifts, highlighting liquidity pools 

1.1 Where is the Liquidity?

Order Blocks are price zones where institutions place large orders. 

These areas often cause strong price reactions and can signal key support or resistance levels. 

They form when a strong move follows a period of consolidation 

1.2 Where is the Liquidity?

This is a Bullish Breaker.

In the circled area you can see price breaking below the prior support level (the dotted line)

Then subsequently coming back up to “fill” that broken area before the big rally. 

1.3 Where is the Liquidity?

A High Probability Bullish Order Block acts as support, pushing prices higher.

However, if it fails, it becomes a Bearish Breaker. 

Now resisting price movement and pushing it downward. 

2. Liquidity Sweep

A Liquidity Sweep occurs when price temporarily moves beyond a key level, such as a previous Swing High or Low, to trigger Stop Loss.

This lure breakout traders into bad positions before reversing in the opposite direction. 

2.1 Liquidity Sweep

A Market Structure Shift occurs when price decisively breaks and holds beyond a prior swing high or low.

Signaling that the existing trend has changed direction and underlying supply–demand dynamics have flipped. 

2.2 Liquidity Sweep

After the strong price move, the formation of a FVG represents a gap between the previous fair value and the new price. 

2.3 Liquidity Sweep

- Has the order flow reached an institutional level?
- Did the price sweep liquidity?
- Did the price result in a CSD?
- Did the price cause a Market Structure Shift?

If the answer is yes, it indicates that a high-probability Order Block has formed. 

2.4 Liquidity Sweep

For a Bullish Order Block, a trader can take an aggressive entry by placing a buy stop order at the high of the bearish candles.

In anticipation of the OB formation. 

2.5 Liquidity Sweep

A less Aggressive approach is to wait for the price to break above the High of the Bearish candles.

Then place a buy limit order at the High of the bearish candles with the expectation that price drops back and tap the high before continuing higher. 

3. Premium and Discount

Premium zone: price above fair value (above VAH or bearish order block), viewed as expensive. Ideal for short entries.

Discount zone: price below fair value (below VAL or bullish order block), viewed as cheap. Ideal for long entries. 

3.1 Premium and Discount

Price makes HH/HL structure. 

After pullback to the last HL, the blue area marks the discount zone (below value) where a red POI offers a buying opportunity. 

The grey premium zone above value is overpriced for longs; red POIs there are weak. 

3.2 Premium and Discount

In the image on the left, the price is bouncing back into the discount zone, which represents a buying opportunity.

On the chart on the right, the premium/discount zone has been wrongly positioned on the bearish retracement. 

3.3 Premium and Discount

Price oscillates between Discount and Premium Zones. 

Strategic entries are executed in the Discount Zone.

While partial profits of 20% and 30% are secured as price advances into the Premium Zone. 