Video walkthrough · 18 min
Not recorded in this build — the written walkthrough below is complete.
Lesson 01 of 03 · Free preview
Swings, trends and structure shifts
Define the trend objectively from swing points.
A swing high is a candle whose high is higher than the highs on both sides of it; a swing low is the mirror image. That is the entire definition, and it is deliberately mechanical — two traders applying it to the same chart and timeframe should mark the same points. Everything that follows is built from those marks, which is what stops 'the trend' from being a description of your mood.
An uptrend is a sequence of higher highs and higher lows. A downtrend is lower highs and lower lows. Anything else is a range, and the honest label for most charts most of the time is 'range'. Read the sequence left to right and write it down: HH, HL, HH, HL is an intact uptrend; HH, HL, HH, then a low that undercuts the previous higher low — HH, HL, HH, LL — is the first objective evidence that the sequence has broken. The break of the prior swing low is the event; the failure of the next rally to exceed the prior high is the confirmation.
Two distinctions save a lot of confusion. A break of structure is continuation — price takes out the swing point in the direction of the existing trend, and the trend is simply extended. A change of character is the first break against the trend: the move that takes out the last higher low in an uptrend. The first tells you to keep your existing bias; the second tells you to suspend it, not to reverse into the opposite position immediately.
Structure is timeframe-specific and that is a feature, not a problem. An H4 uptrend contains M15 downtrends inside every pullback. Decide which timeframe holds your bias and which one holds your trigger, write both into the plan, and stop treating a lower-timeframe break as though it invalidated the higher-timeframe sequence.
The output of this lesson is a bias, not a prediction. 'Higher highs and higher lows intact above 19,150, so I look for longs on pullbacks and take no shorts' is a bias — it names the condition under which it stops being true. 'It's going up' is a prediction and cannot be falsified, which is why it cannot be traded. Work the NAS100 entry linked below: the breakout above the prior swing high, the retest that held, and the 19,150 stop sitting beneath the higher low that defined the sequence.