Module 6: Market Structure · Lesson 38/40
7 min 35 XP
Strip away the noise and a market is always doing one of three things. Trending up: each rally reaches higher than the last (*higher highs*), each pullback bottoms higher than the last (*higher lows*), buyers in control, dips get bought. Trending down: the mirror, *lower highs, lower lows*, rallies get sold. Ranging: neither side wins; price oscillates between a ceiling and a floor while the market decides.
Why does 'the trend is your friend' survive every era? Because a trend is persistence of imbalance: the same surplus of buyers (or sellers) that created the last leg usually creates the next one. Trading *with* the trend means the market's engine works for you; trading against it means betting the engine stalls exactly where you stand, sometimes right, usually expensive.
What you will map next
In the lab that follows, you will click the swing points of a real-looking trend and tag them HH and HL yourself. That tagging, done a hundred times, becomes the automatic first glance of a professional.