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The Market Wizards

Wizards
Trading
Guide
On Price Action
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Haris Khan
Founder - The Market
Wizards
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Table of Contents:

Price Action (The Holy Grail of trading)

• Market Structure
1) Swing Structure + Internal Structure (CHoCH)
2) Trend Change
3) Taking entries

•Supply Demand
1) Contraction
2) Expansion

•Liquidity and Types of Liquidity

1) Chart Patterns Liquidity
2) Trend-line Liquidity

•OrderBlocks and Breakers

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Common terms to memorise in Trading world

HH = Higher High
HL = Higher Low
LL = Lower Low
LH = Lower High
BOS = Break of Structure
MSB = Market Structure Break
CHoCH = Change of Character
FOMO = Fear of Missing Out
ATH = All time High
ATL = All time Low
FUD = Fear, Uncertainty and Doubt
TA = Technical Analysis
DCA = Dollar-Cost Averaging
Alt-coin = Any cryptocurrency other than bitcoin
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Supply & Demand:

To better understand the concepts of Supply & Demand, we have to take a
look what Contraction & Expansion are.

Contraction:
Contraction means when the price is squeezed and stays in a small range. It's like
when something is being pressed tightly. The price keeps getting squeezed until it reaches
a point where it bursts out. So, when we see contraction in the price, we know that at
some point it will break out of that range and start moving again.

Example of Contraction

Expansion:
In expansion, the price makes a strong move either upwards or downwards. It's like
a cycle that keeps repeating. When there is contraction, we know that expansion will
follow, and when there is expansion, we can expect contraction next. It's important to note
that during expansion, prices can change quickly and in unexpected ways, which can be
riskier.
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Demand:
When the price is in a contraction or consolidation phase, meaning it is moving
within a range, and suddenly makes a strong upward move, we call that a demand
zone. It's like a special area where buyers come in and push the price higher, creating
a new bullish trend. Here is an actual chart image of a demand zone:
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Supply:
Supply is the opposite of demand. When the price is in a contraction or
consolidation phase, moving within a range, and suddenly makes a strong downward
move, we call that a supply zone. It's like a special area where sellers take control and
push the price lower, creating a new bearish trend. Here is an actual chart image of a
supply zone:
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Market Structure:
Market structure in cryptocurrency refers to how the market behaves and how
prices respond to trends and shifts in trends. It is in uenced by various important
factors, including:

• Supply Demand
• Price Trends
• Support and Resistance levels
• Trading Volume

Price Swings:
We get to see the price movement in market in form of Highs and Lows or we
can say the swings.

Market Phases: There are 2 types of market phases. Bullish and Bearish as
explained below.

1) Higher Highs & Higher Lows:

When the price forms higher highs and higher lows, it indicates an uptrend.
After a new higher high, a pullback of a higher low is expected, acting as a trigger
point. This pullback fuels the market for another higher high. This pattern of higher
highs and higher lows continues in an uptrend.

Here is an example of HH & HL

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2) Lower Lows & Lower Highs:

When the price forms lower lows and lower highs, it indicates a downtrend. In
this situation, short sellers come into play. After a new lower low, a pullback with a
lower high is expected, acting as a trigger point. This pullback serves as fuel for the
market, same as HH and HL which then re lls itself and moves towards another lower
low.

Here is an example of LL & LH

Internal Structure:
The concept of internal structure refers to smaller patterns or trends that occur
within a larger uptrend, characterised by higher highs and higher lows. These smaller
patterns, known as internal structure, can be observed on shorter time frames. An
internal structure break occurs when there is a break in any pattern or price trend
within the ongoing higher highs and higher lows trend on the larger time frame.
Traders use these internal structure breaks as potential entry or exit points for their
trades. It's important to note that internal structure breaks can occur in any market
trend, including ranges or other trends.

Example of Internal Structure Break

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Break of Structure (BOS)

A break of structure refers to a price movement that goes against an
established pattern or structure. For example, in an uptrend characterised by
higher highs and higher lows, each new higher high must surpass the previous
one after pullbacks. If the price fails to achieve a new higher high and instead
moves lower, it indicates a break of structure. This break can suggest a
potential shift in the market direction or trend. Traders often monitor break of
structure as it can provide trading opportunities or signal a change in market
dynamics.
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Market Structure Break (MSB)

Market Structure break refers to the shift of market to the whole new
direction e.g If price was moving in uptrend then it will shift to downtrend after
MSB or vice versa.

Apply these learnings and stay ahead of curve

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Order Blocks:
Order Blocks, also known as liquidity zones, are speci c price levels on a
chart where signi cant buying or selling orders are lying. Order Blocks can act
as support or resistance levels, in uencing price movements when the market
revisits those levels. Traders often look for Order Blocks to identify potential
areas of buying or selling.

Actual Example of Bullish Order Block

Actual Example of Bearish Order Block

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Breakers:
Breakers are price levels that, when breached, can trigger signi cant
price movements or trend reversals.
A Failed order block is known as BREAKER! When Price doesn’t respect
a speci c order block and passes through it then that failed order block
becomes a breaker.

Order Blocks:
Order Blocks, also known as liquidity zones, are speci c price levels on a
chart where signi cant buying or selling orders are lying. Order Blocks can act
as support or resistance levels, in uencing price movements when the market
revisits those levels. Traders often look for Order Blocks to identify potential
areas of buying or selling.
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