Archives - Structure targeting

A small example why low-probability setups occur and how you might be able to avoid them.

Naturally, looking at the price action on the left, you might be inclined to be looking for long setups. Especially at the time this happened. August, thin orderbooks and low volume within the markets.

Here you will see the first signs of uncertainty occur when we create that protected low. As you may be wondering, that's a good sign for bullish expansions right?

Sure, but it took out the very small SSL marked by the small gray box prior to it. It then expands and starts compressing. What is the issue here? The compression is NOT a distribution, rather it is creating this wedge to the upside... Which creates more weak highs.

You guessed it.. Once we created those weak highs, the narrative changes, you can notice this by the sudden erratic move.

So what this does is that it grabs liquidity, you guessed it, to go up, to fuel the move down.

in conclusion, the rule of thumb we want to take away from this:

Once we are already trading with low resistive lows/highs under/above us, and price makes uncertain compressions in the SAME direction as our bias followed by a liquidity shakeout, the chances of sentiment shift are large.


Naturally, looking at the price action on the left, you might be inclined to be looking for long setups. Especially at the time this happened. August, thin orderbooks and low volume within the markets.

Here you will see the first signs of uncertainty occur when we create that protected low. As you may be wondering, that's a good sign for bullish expansions right?

Sure, but it took out the very small SSL marked by the small gray box prior to it. It then expands and starts compressing. What is the issue here? The compression is NOT a distribution, rather it is creating this wedge to the upside... Which creates more weak highs.

You guessed it.. Once we created those weak highs, the narrative changes, you can notice this by the sudden erratic move.

So what this does is that it grabs liquidity, you guessed it, to go up, to fuel the move down.

in conclusion, the rule of thumb we want to take away from this:

Once we are already trading with low resistive lows/highs under/above us, and price makes uncertain compressions in the SAME direction as our bias followed by a liquidity shakeout, the chances of sentiment shift are large.


Naturally, looking at the price action on the left, you might be inclined to be looking for long setups. Especially at the time this happened. August, thin orderbooks and low volume within the markets.

Here you will see the first signs of uncertainty occur when we create that protected low. As you may be wondering, that's a good sign for bullish expansions right?

Sure, but it took out the very small SSL marked by the small gray box prior to it. It then expands and starts compressing. What is the issue here? The compression is NOT a distribution, rather it is creating this wedge to the upside... Which creates more weak highs.

You guessed it.. Once we created those weak highs, the narrative changes, you can notice this by the sudden erratic move.

So what this does is that it grabs liquidity, you guessed it, to go up, to fuel the move down.

in conclusion, the rule of thumb we want to take away from this:

Once we are already trading with low resistive lows/highs under/above us, and price makes uncertain compressions in the SAME direction as our bias followed by a liquidity shakeout, the chances of sentiment shift are large.


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