BEST TRADING STRATEGY / Scalping to Swing Trade. HOW to Trade PRICE ACTION & Market Structure Breaks | Summary and Q&A

TL;DR
This video introduces the concept of market structure breaks as a key component of price action trading and smart money strategies.
Key Insights
- 🔍 Market structure breaks are a key sign of possible trend reversals, making up around 80% of price action trading strategies. Understanding and recognizing market structure breaks is essential for successful trading and investing.
- 📉 There are two types of market structure breaks: strong and weak. Strong breaks occur when the price breaks the last lower high with strong candlesticks and closes above it, while weak breaks involve struggles and wicks without strong candlesticks or closes.
- 🎯 The area between the last lower high and the deepest lower low is the entry zone, where market makers and institutional entries occur. This entry zone is crucial for price action and smart money traders, serving as the foundation for various trading strategies.
- 📊 Chart patterns can be used in conjunction with market structure breaks, allowing for more accurate trade entries. Market structure breaks determine the setup for chart patterns, creating reliable trading opportunities.
- 🖊️ Entries can be made using the same time frame as the market structure break, based on specific candlestick patterns like hammers, pin bars, and engulfing patterns. Alternatively, traders can use a higher time frame to confirm the market structure break and a lower time frame to find entry points.
- 💰 Using market structure break trading strategies, traders can achieve consistent profits of 30%, 50%, or even 100%. Market structure breaks are the core foundation of successful trades across all trading styles, from retail traders to smart money traders.
- 📈 Understanding market structure breaks and practicing various entry strategies, such as order blocks, Quasimodo levels, and Fibonacci levels, can lead to successful trading outcomes and significant gains.
- 📚 The next video in the course will provide real trading examples to further illustrate the concepts and strategies discussed in this lesson. Make sure to subscribe to the channel to stay updated and learn more.
Transcript
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Questions & Answers
Q: What is the significance of market structure breaks in price action trading?
Market structure breaks are important because they indicate possible trend reversals and are used in various price action trading strategies. Identifying MSBs can give traders an edge in the market.
Q: How can you differentiate between strong and weak market structure breaks?
Strong market structure breaks are characterized by a strong break of the last lower high, often accompanied by strong candlesticks. Weak market structure breaks may show more struggle and lack strong candlestick closes.
Q: Why is the entry zone between the last lower high and the deepest lower low important?
The entry zone is where market makers and institutionals enter the market, making it a significant area for potential trade entries. It can be used in conjunction with various price action strategies and levels.
Q: Can chart patterns be used in conjunction with market structure breaks?
Yes, market structure breaks can be used to confirm and enhance the effectiveness of chart patterns. By waiting for a market structure break within a pattern, traders can improve the reliability of their entries.
Q: How do traders determine suitable entry points using market structure breaks?
Traders can use various types of entries, such as order blocks, Quasimodo levels, or Fibonacci levels, in conjunction with market structure breaks. These entries can be identified on the same timeframe or lower timeframes.
Q: Why are hammers, pin bars, and spinning tops significant for entries?
These specific candlestick patterns can indicate a strong will of buyers or sellers, and when combined with a strong candle forming a bullish or bearish engulfing pattern, they can provide potential entry signals.
Q: How do pro price action traders make sniper trades with high gains?
Pro price action traders often confirm market structure breaks on a higher timeframe and then look for micro market structure breaks on lower timeframes for more precise entries. This allows them to capitalize on high-gain trades.
Q: What can traders expect in the next video?
The next video will provide real trading examples using the market structure break trading strategy, allowing viewers to see how it is applied in practice.
Q: What is the significance of market structure breaks in price action trading?
Market structure breaks are important because they indicate possible trend reversals and are used in various price action trading strategies. Identifying MSBs can give traders an edge in the market.
Summary & Key Takeaways
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Market structure breaks (MSBs) are an important sign of possible trend reversals and are integral to price action trading strategies.
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There are two types of MSBs: strong MSBs, which are characterized by a strong break of the last lower high, and weak MSBs, which may be less reliable.
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Understanding the entry zone, which is the area between the last lower high and the deepest lower low, is crucial for identifying potential trade entries.