MARKET STRUCTURE PRESENTATION

MARKET STRUCTURE X SMC

@WONGFORWONG

DISCIPLINE | PLANNING | EXECUTION

CONTENTS
4.4
ORDERBLOCK
INDUCEMENT
BOS VS CHOCH
INDUCEMENT, LIQUIDITY
BASICS 1.1 MITIGATION
EXPANSION & RETRACEMENT IPA, FVG, IMBALANCE
FIBONACCI RETRACEMENT QUASIMODO
BMS
RANGE HIGH AND RANGE LOS
FAILURE SWING SMS 5.5
SESSIONS:
ASIAN SESSON
2.2 LONDON SESSION
MARKER STRUCTURE IN BULLISH NEW YORK SESSION
CONDITIONS 3 POWERFUL MS
SELL MODEL

3.3
LIQUIDITY TYPES 6.6 POWERFUL SETUPS
WHAT TO FOCUS ON BSL,SSL TURTLE SOUP
STOP HUNT
HIGH IMPACT NEWS OR FA
7.7
CONFLUENCE
HTF, LTF
EXPANSION vs RETRACEMENT

EXPANSION

RET
Occurs when there is a impulsive
movement towards a direction.

RAC

N
N

IO
IO

EME
S

S
N
N
A

A
P

P
NT
EX

EX
RETRACEMENT

The correction movement after

impulsive movement.
 FIBONACCI RETRACEMENT
The Fibonacci retracement tool plots percentage retracement lines based upon the mathematical
relationship within the Fibonacci sequence. These retracement levels provide support and resistance
levels that can be used to target price objectives.
FIBONACCI RETRACEMENT (OTE)

It is used to determine the end of the retraction movement,

usually the price retracts to 0.5 or until OTE (0.62, 0.705,
0.79) before another impulse movement occurs.

The OTE zone is the zone of the optimal entry point, in which
the next structural element (LH or HL) can be formed. It is
always in the premium zone when you are looking for an
entry point into shorts, and in the discount zone to open
longs.
 FIBONACCI RETRACEMENT
Here we show the full suite of fibs in
coloured boxes

These can be broken down per the below:

Anchor levels being the '1' and the '0' (light orange,
and teal respectively)
The trade entry levels of 0.618, 0.702, & 0.786
(yellow)
And the target levels of 0.28, 0,-0.27,
-0.618 & -1 (green, blue, purple, pink)

Let's delve into the background of the fibs

One thing to note with these Fib levels are that

they are percentages of a move, ie if pulling a fib
from a swing low to a high (100% to 0%), and
price retraces to the 0.702 level.

This in essence means that price has retraced by

70.2% from where you had pulled your fib set up to and
from
(BMS) Break In Market Structure
BMS occurs when the price close
above / below a swing high/low,
generally, every trader should trade in
the direction of the HTF BMS.

Original (BOS)

NOTE:
After BMS always wait for retracement.
 RANGE HIGH AND RANGE LOW

After the BMS there will always be the

formation of a new consolidation, that is
called RH and RL

NOTES:

Trade in the direction of the BMS

After BMS wait for retracement to 0.5 or OTE of
fibonacci levels.
FAILURE SWING (SMS)

When there is an uptrend market

and the price fails to break the last
top (swing high) and breaks the
previous bottom (Swing Low), an
SMS is considered to have ocurred
(vice versa for Bearish)
 MARKET STRUCTURE
The price can simply be found in one of the 3 phases below:
 LIQUIDITY

The crypto market is zero sum game, which means that for a trader/insitution to buy/sell 1
currency pair it's necessay that there is another trader/ institution with an opposite position. If
smart money (banks) wants to buy a currency pair they will need sellers in the market, the
existing facility to place these position in the market is called liquidity.

The liquidity is defined by Stop Losses, where stoploss exist is where the liquidity also exists,
smart money need to active the stop losses of existing orders in the market so that they can
plase their positions in the market.

The banks manipulate the price because of liquidity, but why?

Banks negotiate large trading volumes and sometime find it difficult to find the other side of their
trades, so they manipulate the price so that they can have their positions in the market.
TYPES OF LIQUIDITY
LIQUIDITY TYPES
BSL ( Buy stops liquidity)
SSL ( Sell stops liquidity)

Both of thess are areas of price in which bsl and

ssl are mostly resising.

When we understand the higher timeframe, we

can see where the smart money are possibly
going to go long or short due to areas of price
creating support and resistance.

Price will use these areas to seek liquidity in order

to reverse or continute within it's expansion move.
BUY STOPS LIQUIDITY (BSL)
The BSL is originated by stop losses of sell order, after the BSL is taken, the market
reverses to the downside because banks use the BSL to place sell orders in the
market.

What to focus on BSL?

PMH - Previous Month High
PWH - Previous Week High
PDH - Previous Day High
HOD - High of Day
Old High - Swing High
Equal highs - retail resistance
BUY STOPS LIQUIDITY (BSL)
SELL STOP LIQUIDITY (SSL)

The SSL is originated by stop losses of buy orders, after the SSL is taken, the market
reverses to the upside, because banks use the ssl to place buy orders in the market.

PML - Previous Month Low

PWL - Previous Week Low
PDL- Previous Day Low
LOD - High of Day
Old High - Swing Low
Equal lows- retail support
 STOP HUNT: Manipulation For Liquidity

Stop hunt is a movement used to

neutralize liquidity (stop losses). It's a
false breakout above/below the zone
where there is LIQUIDITY.

The market markers (BANK) usually use

high impact news to take liquidity.

STOP HUNT
ORDERBLOCKS
Orderblock are candles where market makers have placed their
positions, generally, 6he market returns to those candles and they
are never violated.

Orderblock are actually special supply and demand zones that are
form when there is a orderblock.

There are two typles of orderblocks:

Bullish Orderblocks
Bearish Orderblocks
Bullish Orderblock

The bullish orderblock is the last bearish candle before the bullish
movement that break the market structure higher represents a high
possibility of holding the price, when the price returns to it.
Bearish Orderblock

The bearish orderblock is the last bullish candle before the bearish
movement, that break the market structure lower, represents a high
possibility of holding the price, when the price returns to it.
 What makes Orderblock valid?

1. It must break structure

2. The bull(or bear) candle must have a lot volume or momentum

3. It should have imbalance(or efficiency)

4. It should be located near a HTF support or resistance level (at least on a directional TF)

5. The OB should be fresh(yet to be mitigated)

6. The pull back into the OB should be weak and choppy.

If an OB respects these rules, then it has 90% chances of holding.

@credits
 What is a breaker?

Similar to Order Blocks, Breakers were something that I first encountered when
watching ICT's videos

A Breaker Block in my view is essentially a previous bullish or bearish orderblock, that

has been traded through, and now forms as support or resistance

Breaker = bullish or bearish OB that fails to hold,

where price trades through, and then flips to act as support or resistance
 CHoCH and BOS

BOS or break of structure - refers to

trend continuation where the market is an
uptrend making Higher Highs and High
lows if the market is in a downtrend
making lower low and lower high.

CHoCH or change of character

refers to a potential shift in an
existing trend from uptrend to
downtrend and downtrend to
uptrend.

HL & HH - LL & LH
LL & LH - HH & LH
Imbalance = Fair Value Gap = Inefficiency

Imbalance occur when either buyers or sellers take control over a particular
piece of price action. Which will essentially leave gaps in market that price
will come back to in future to rebalance the price.
INDUCEMENT
Inducement is a trap left
on purpose by banks or
whales to mitigate the
orderblock or sweep
liquidity later. The move
is designed to take out
early sellers and pattern
traders. Inducement =
trapped liquidity.

@credits
Quasimodo (QM)

Basically, it consists of shorting the

right shoulder of a H&S pattern. In the
case of a bullish O/U, longing the
right shoulder.

This concept entry was named after a

character from the cartoon
quasimodo.

It is not valid if there is no bos +

choch. Enter position placing your SL
above/below the ‘’head’’ of the pattern

Highly respected on 3m timeframe.

 First Obstacle (Fo)

Price not always tends to retest S/D orderblocks or perfectly flipped

highs/levels. Knowing that, we could mark
out possible opportunities to join a strong trend by marking the First Obstacles.

What is a First Obstacle?

• In an uptrend, this is the first resistance after a break of a previous swing high
• In a downtrend, this is the first support after a break of a previous swing low
 The Timeframe Matrix
Having a directional bias is one of the most useful things you can implement in
your strategy.
Price may not be having the same structure at all timeframes, so a directional
bias allows you play in tandem with a HTF trend and knowing what side of the
market is being favored and which isn’t. Therefore, having a directional bias
enhances

Your probabilities of succeeding. When looking at a setup, you want to make

sure you are not counter-trend trading. Therefore, at least two timeframes
should be pointing in the same direction, it’s not about catching perfect
bottoms or shorting absolute tops, it’s about finding high R:R plays.
Let’s say we have a whole day for ourselves and want to spend the day scalping at home. The steps would be:
1. Determine the HTF Structure
a. In this case, finding the market structure at the H1 chart

2. Mark out the key levels at the HTF chart

a. You don’t want to find yourself shorting a 5-minutes supply block when price is approaching a H1
demand orderblock - timeframes have hierarchy over each other

3. Determine the Directional Bias structure

a. In this case, finding the market structure at the M15 chart
4. Mark out the key levels at the Directional Bias chart
a. In this case, we would highlight levels from the 15-minutes chart – remember timeframes hierarchy
i. Look for orderblocks, S/R

5. Execute in your entry timeframe according to your directional bias:

a. If the directional bias is bullish = look for longs
i. Refine your entries within the M5, M3 and M1 chart
b. If the directional bias is bearish = look for shorts
i. Refine your entries within the M5, M3 and m1 chart

Always be aware of HTF market structure

Don’t trade against your directional bias
If your directional bias is bullish, you are looking for longs
If your directional bias is bearish, you are looking for shorts
 Swing Failure Pattern

Swing Failure Pattern (SFP)

A swing failure pattern occurs when a candle trades above/below a significant swing high/low, then fails to close
above/below. These are basically failed attempts to break structure.
Exhibit: Bullish SFP - Inverse logic applies to a bearish SFP
 Three key attributes of a range:

1. Range High/Low : Key swing points of the determined 2. EQ/Mid-Range

range. This is the mid range, i.e 50% level. Above mid range, price is
2. EQ: Mid Range (50% level) at a premium; hence look for
3. Deviations: Trades below/above set range (false break) shorts. Below mid range, price is at a discount; hence look for
before ultimately trading longs.
back in mean range.
3. Deviations
1. Range High/Low Price trades above/below the range swing points (Range
After an impulse move, key swing points will form. These High/Low), before ultimately trading
swing points will be your range back in the range. Generally, if price deviates a swing point,
high and low. Ideally: expect the opposite swing point to
1. After an impulse move downwards, mark the range from get tested.
first swing high to swing
low Ranges indicate one of 2 things:
2. After an impulse move upwards, mark the range from 1. High volume orderflow
first swing low to swing high. 2. Low volume in the market
MORE CONFLUENCE = HIGHER PROBABILITY!
Accumulation, Manipulation and Distribution {ADM}

Accumulation:
The accumulation of positions generally occurs during the Asian Session, the accumulation is characterized by being a
consolidation (Asian Session) but it may not be the Asian Session.

Manipulation:
Usually occurs at the opening of the London session, this manipulation consists of taking the price to the opposite side of
the true direction of the rest of the day.

Distribution:
Occurs when MMs liquidate (exit) their positions.
 Expansion

Accumulation

Manipulation
Turtle Soup Short and Long

The price usually sweeps 5-20 pips (even more above or below a point where liquidity exist, after the price
sweep the point, enter a trade against the movement used to sweep stops (liquidity)

BSL raid = Turtle Soup Short

SSL raid = Turtle Soup Long

Turtle Soup Short - PDH, HOD, OH, EQH

Turtle Soup Long - PDL, LOD, OL, EQL
How to trade SH, BMS and RTO?
First, occurs the SH,
that movement is
used by market
makers to neutralize
liquidity.

Second, there is a
BMS or break in
market structure
confirming the SH.

Thirdly, the price

return to orderblock
(RTO)
How to trade BMS, BMS and RTO?

First the price fails to

break a top or
bottoms.
Secondly, there's a
BMS confirming the
SMS
Thirdly, the price
return to order block
(RTO)
 Confluence
Conflunece is very important to increase chance of winning trades, a trader
needs to have at least two factors of confluence to open a trade. When the
confluence exists , the trader becomes more confident on his negotiations.

Timeframe Setups
For swing trading For short term trading
HTFL Weekly, daily, H4 HTF: Daily, H4, H1
Entries H1, M30, M15, sometimes H4 Entries: M30, M15 sometimes H1

For day trades and scalps

HTF: H4, H1, M30
Entries: M15, M5,M1 (sometimes M30)
 MAFIA
ICARUS
DISCIPLINE | PLANNING | EXECUTION