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Market Structure (MSS & BOS)

Market Structure (MSS & BOS) represents the dominant trend based on swing highs and lows. Understanding market structure is crucial for identifying trend direction and potential reversal points.

Market Structure Analysis Example

Understanding Market Structure​

Market structure is defined by:

  1. Uptrend Characteristics

    • Higher Highs (HH)
    • Higher Lows (HL)
    • Bullish momentum

  2. Downtrend Characteristics

    • Lower Lows (LL)
    • Lower Highs (LH)
    • Bearish momentum

Market Structure Shift (MSS)​

Also known as Change of Character (ChoCh), an MSS occurs when:

  • Market transitions between trends
  • Previous structure is invalidated
  • New trend direction emerges

Key MSS Components​

  1. Trend Transition

    • Up to down trend shift
    • Down to up trend shift
    • Consolidation phase

  2. Confirmation Zones

    • Strong supply areas
    • Strong demand areas
    • Order Block alignment

Break of Structure (BOS)​

A Break of Structure signals trend continuation through:

  • Breaking established ranges
  • Confirming dominant trends
  • Creating new price extremes
Pro Tip

Combine Market Structure analysis with Fair Value Gaps for stronger trade confirmation.

FAQ​

Next Steps​

Explore Order Blocks

Learn how Market Structure aligns with Order Blocks

Volume Analysis

Master volume analysis for better trend confirmation