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Structure 2

Top-down analysis is important, especially when first analyzing a market, to avoid getting lost in lower timeframes and forgetting the bigger picture. Structure within a higher timeframe like the 4-hour chart will contain many more potential breakouts, pullbacks, and other patterns if viewed on lower timeframes like the 1-minute chart. It is best to wait for a potential setup like a break of structure to appear on the higher 4-hour timeframe before drilling down to lower timeframes, rather than chasing setups and risking losing trades. Breaks of structure can occur both with and against the main trend, so it is important to use higher timeframes to identify the main trend direction.

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109 views5 pages

Structure 2

Top-down analysis is important, especially when first analyzing a market, to avoid getting lost in lower timeframes and forgetting the bigger picture. Structure within a higher timeframe like the 4-hour chart will contain many more potential breakouts, pullbacks, and other patterns if viewed on lower timeframes like the 1-minute chart. It is best to wait for a potential setup like a break of structure to appear on the higher 4-hour timeframe before drilling down to lower timeframes, rather than chasing setups and risking losing trades. Breaks of structure can occur both with and against the main trend, so it is important to use higher timeframes to identify the main trend direction.

Uploaded by

raw raj
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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STRUCTURE 2

Structure can be very confusing if you allow it to be. Sticking to a set of rules on
how we view structure can simplify things a lot more. Top down analysis is
essential especially at the beginning as we can all get lost in the lower timeframes
and forget the bigger picture.

This is our 4H structure with BOS and OB's marked. But what is within this
structure?

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Now we go to a lower timeframe, does this make sense? No it looks ridiculous
but this is what is basically within your 4H timeframe and by the time you get to
the 1M it has multiplied by 100 more BOS, OB's and all that other fancy stuff. But
we have dozens of pairs and a hundred markets to follow so why not just wait for
price to approach what you have marked on the 4H and then scale down?
Moving down from the 4H timeframe without seeing a potential setup means you
are chasing setups and immediately you have lost the trade.

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Just find this on your 4H and wait for it to play.

BOS can happen with the trend.

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Or against trend.

But it is very very important to use your higher timeframe to see where price is
impulsing and breaking structure and stay off the lower timeframes unless an
entry is possible.

A BOS is only a BOS if a swing high or swing low has been broken.

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STRUCTURE 2 5

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