How To Detect Market Structure

[moonchild]

Market Structure is basically how a market behaves this means the constant state of the market whether it's going up or going down, market structure shows you what the market is saying and knowing how to deal with market structure is very important in Forex because you'll be able to know which time you should enter and which time you should exit and which time you should stay back and fold your hands.

We have basically types of market structures namely:

Uptrend Market Structure: This is a state of the market where it's going up and forming a series of higher highs and lower lows as a retracement, this is a signal that shows you the buyers are in control and its a good time to buy.

Downtrend Market Structure: This is a state of the market where price is going down making a series of lower lows and higher lows as retracement, this shows that sellers are in control and it's a good time to sell the market.

Consolidation: This is a state where there's no any definite movement in the market and price is just moving sideways, in this situation, you should just fold your hand and watch because it's an indecision stage.

 

[Mary Frederick]

In my trading, I rely on the daily support/resistant levels to identify the market trend! On the other hand, market momentum is another important parameter that I need to finds out according to the trading chart’s pattern!

 

[Setho]

As you have rightly said market structure is talking about the current trend that is existing at the moment in the market and how price is behaving . They are generally three types of market structure even though there can be so many others but it is broadly incorporated into these three main ones.
The first one is the uptrend which is characterized by price movements that is going much more higher than the previous close . The second one is the downtrend in which price is moving far below the previous close . The third one is the consolidation stage in which there is characteristically sideways movement of price with no increase and no decrease significantly noted .

The most important thing about identifying market structure is that no matter what it is you should be able to confirm it on a higher time frame . This is a mistake that a lot of people do because no matter how bullish you are on low time frame , and the dominant trend is bearish, you have to be bias.

You can also be able to identify market structure through rising and decreasing trading volumes and the number of active addresses.