Transcript for:
Mastering Break of Structure in Trading

what is good jitl lets welcome to my new and improved break of structure video as you guys know I would never take a trade without seeing a break of structure on any of my execution time frames and for those of you guys who don't know me my name is tjr I've made over seven figures in profit day trading just at the right age of 22 years old and today I'm going to show you guys how to identify breakup structure within the market and on top of that how you guys can use breakup structure to take higher probability trades within the market and on top of that I know that this is a video that would have helped me a lot as an unprofitable Trader when I was learning how to trade so without further Ado let's get right into it all right boom chartwork time okay so first and foremost before we actually get into the charts I want to explain to you guys what is break of structure okay so break of structure identifies a trend shift in current market structure and on top of that it can indicate orders being filled so before we go into the charts and showing this I'm going to do a little Picasso drawing for you guys because I figure that helps you guys best to see it just with lines instead of candlesticks first and then from there we'll go into the candlesticks show you guys how to identify break INF structure and how we can also combine break of structure with some of the other confluences that I've taught you guys about to actually complete and make a trade so first of all with this description of breakup structure being able to identify a trend shift in current market structure we need to understand the three ways that the market moves okay there's three different ways that the market moves in an uptrend in a downtrend and in consolidation Okay so we're going to draw both of those out this is super basic you guys know Market moves up in an uptrend with higher highs and higher lows right this is like kindergarten up day trading and then in consolidation it's just moving sideways and then in the downtrend it's moving in lower lows and lower highs okay so with that in mind what is a break of structure within all three of these more specifically what is a break of structure within these two the uptrend and the downtrend a break of structure within an uptrend let's move past these Picasso drawings let's draw another uptrend is quite simply when a low gets closed below within an uptrend plain and simple on any time frame like you're probably thinking no there has to be more no we keep it down synd sorry that was bad we keep it autistic we keep it basic we keep it fundamental kindergarten level around here so that anybody can understand this I'm 22 years old I don't give a [ __ ] about any of the [ __ ] calculations and the approximations okay I'm going to keep this really [ __ ] simple for you guys when we are within an uptrend higher highs and higher lows what are we waiting for to see a break of structure we look for the most recent low to get closed underneath and I'm going to show you guys that within the candlesticks boom we're said and done with this now okay we're speedrunning this baby now downtrends we're going to make you guys profitable literally in the fastest way possible downtrends lower lows lower highs how do we know structure has been broken to the upside Bull Run [ __ ] okay sorry I'm wired okay Bull Run [ __ ] we close above a high okay so pause before we speedrun even more why is this a break of structure well let's just think about it downtrends consist of lower highs and lower lows okay so that's the current structure so in order for this structure to break what has to happen mink it like L literally it's in the [ __ ] name the name is the definition the current structure is lower high lower low lower high lower low and then what happens oh structure got broken why because now there's a higher high which will eventually turn into a higher low and then there you go and then look uptrend okay we'll do this too maybe we SP run a little bit too fast but look okay now uptrend higher high higher low higher high higher low higher high higher low higher high how do we know when it has broken structure bang lower low lower high reversal work okay that's how we can identify a break of structure within both of the trending Market structures now for consolidation we won't get too deep into that however I can't explain it consolidation there's going to be lots of breaks of structure all within here and that's the one thing that kind of sucks about consolidation it's just because price is moving sideways and there's no actual Trend the easiest way for us to see and identify a break of structure it's not even a break of structure it's going to be a breakout of Boom this range okay so if we see closure above boom these highs and then boom we start an uptrend obviously that's going to be breaking out of the current market structure which is consolidation same thing can happen to the downside if we see a breakout of these lows and then we start forming a downtrend obviously that's going to be breaking out of the structure which is consolidation cool cool we're already learning we're already doing good now let's jump into the charts this is going to be quick easy simple video okay to help you guys identify break of structure I'm also going to teach you guys what is not a break of structure because for whatever reason a lot of people struggle with this okay let's get hold on let's get into it we'll just start off on the 15 minute time frame gorgeous okay matter of fact let's go into the 5 minute time frame because I remember there was a gorgeous uptrend right here so let's just start this off let's say that we don't see anything past this point in time okay so what is what do we see right here also let me shrink my face what do we see right here we have my mouse I need a mouse pad okay I need a maxi pad period time sorry lock in okay we we have a high right here this was the previous low high lower low lower high lower low okay so right now the current market structure what is it it's a downtrend okay so for us to be able to identify a break of structure we need this is very important a closure a candle closure not a wick okay and I'll show you guys examples of what is not a break of structure after we show you guys what is a break of structure okay but we need a candle closure so when we are waiting for a break of structure within any of our strategies if that's part of our step by step okay let's say we want a break of structure to the upside we are going to be monitoring the highs okay so again what's a high within the market it's a two Candlestick pattern a move up then a move down so there needs to be in my case a blue Candlestick and then a black Candlestick in this case we have a blue Candlestick kind of an unidentical unident kind of a unidentifiable dogee but then we see a Candlestick right here so we can go ahead and just call this the high and regardless this candle closes above all three of those candles so it's pretty safe to say that it was a break of structure but anyways we identify hey we're in a downtrend right now we have high low lower high lower low but we're waiting for a breaking structure to the upside when do we get the breaking structure to the upside when this Candlestick fully closes Above This high now what do now what are we in we're in an uptrend higher high than this high High higher low than this low and then what happens higher high higher low higher high higher low higher high higher low higher high higher low higher high higher low higher high higher low higher high and then we get a mini break structure to the downside to give us probably like a 15minute retrace price continues higher so boom perfect example of a break of structure to the upside now let's show break of structure to the to the downside okay we'll use this example within here price action let's just take this little move up for for our example right here we're in an uptrend okay high low higher high higher low higher high higher low higher high higher low higher high bang what happens we're monitoring the lows what happens on this Candlestick we get a closure closure the candle closes underneath this low in turn high this was the previous low lower low lower high kind of a bit of consolidation right here but then boom lower low lower high lower low and then we get a mini flip towards Market close Okay so again something that I really want you guys to understand is when we're looking at break of structure it's not as simple as hey price broke structure I'm just going to press buy or hey price broke structure to the downside so I'm going to press sell no we need to take everything into account and and I'm going to be making a video probably in like the next month or so combining all of these Confluence videos that I'm remaking like I just made that liquidity video I'm now making a break of structure video I'm going to be making a new fair value get video combining all of these things together to show you guys how to actually execute a trade this is just teaching you guys the Confluence of break of structure okay so again don't be blindly taking trades when you just see oh price broke structure to the downside because like we saw right here price did break structure to the downside right here this was the most recent low and then we break structure but then what happens price rips up okay so again these confluences essentially mean nothing without context okay and again if you were to take this trade I would have called you an idiot because you're taking it at 12 p.m. on a freaking Friday when Market's about to close Okay so again we need context with all of these confluences before just jumping into a trade however when we fully understand these confluences that I'm teaching you guys we can actually apply them to our full strategy and when we have context and apply these confluences we can actually take really good trades okay now we understand what a breaking structure to the upside is it's a full candle closure above a high so again going back here when we are in a downtrend okay how do we know that we are in a downtrend right here first of all okay we were in an uptrend beforehand right we have a high we have a low higher high higher low higher high this is a good example of what is not a break of structure but we'll get to that a little bit later okay boom we move up but then what happens this is the most recent low how do we know that we break structure because this candle closed underneath it okay from there lower high lower low and then so we're in a downtrend right now we get a candle closure above right here okay something else that a lot of people get confused is we will literally be in an uptrend like this perfect example right here okay we break structure to the upside what are we in right now we are in an uptrend on the F minute time frame correct we've just broke structure right here they will Mark out a high when we are already in an uptrend and they will be like broh um we just broke structure to the up side no idiot we're already in a [ __ ] uptrend you can't break structure to the upside when we're ow when we're already in an uptrend get it through your head we broke structure to the upside right here why because we were in a downtrend we this is not a break of structure this this is Trend continuation oh we did we tjr I saw a break of structure on the 5 minute right here and it's already in an uptrend it can't break the same structure two times in a row okay so now that we know we're in an uptrend let's see where we break structure to the downside because we can't break structure to the upside twice because we're already in an uptrend okay so what do we want to do to be able to identify breaks of structure to the downside well we're going to be monitoring lows why because in order for us to break structure from an uptrend to break uptrend Market structure we we need to close underneath a low so where would the break of structure B it would be after this low gets closed underneath right and again all like I said before this comes with context obviously we can't just press sell here but th this would be a break of structure to the downside and it is a break of structure to the downside okay just had to clear that up now let's Show an example of what is not a break of structure again like I was saying we have to have a full candle closure above a high or below a low so again let's look at this price action right here we're in an uptrend how do I know that because we have let's just do this high right here low right here high right here low right here we're moving in higher highs and higher lows we have a high right here and then again let's say we're monitoring for a break of structure to the downside we see price oh okay we push past this low is this a break of structure somebody answer for me no it's not you want to know why because this is a pube this is a Candlestick Wick this is not a full Black Candle closing underneath here this is just a wick so when we see a Candlestick Wick down here this this in fact is maintaining bullish structure I know it goes against the concept of like oh like higher highs and higher lows because technically this low is now lower than this one but we are still maintaining bullish structure because we did not close underneath this low so now with that in mind we continue bullish structure and when we're looking for a break of structure to the downside what do we do do we keep our line on this low no because now this is the most recent low for structure to break we're not monitoring a low that happened like seven lows ago we are looking at the most recent highs and the most recent lows that are made within the trend okay so for this example we're not assuming that this brake structure on this Candlestick Wick no then what happens this forms a low a move down then a move up when do we see price actually break structure to the downside on this Candlestick right here why because we actually see a Candlestick closure underneath here okay let's Show an example of this to the upside perfect we have one right here okay we're in a downtrend right here right we have highs up here lower low lower high lower low lower high let's say that we're waiting for for a break of structure to the upside okay we're monitoring highs okay we have this high right here oh no it doesn't get broken okay we form a new high right here oh what happens hey what's that what's that what's that what's that what's that Wick do I enter off of this Wick tjr no do I enter off of this Wick master sensei no do I enter off of this Wick is it different because it's a black candle wick no we don't see color we see Candlestick Wicks okay we don't give a [ __ ] if they're black blue white asian we don't care okay I said that because these are Japanese candlesticks no racial okay this is the high but what we can consider is we have a move up then a move down so what does this now make it what does this what does that now make this this is a new high within still this is still a downtrend keep that in mind we are not in an uptrend yet until boom this candle closes Above This candlestick's high and then as we can see price ends up moving up cool cool so I'm pretty sure you guys get the point when we are in an uptrend higher highs and higher lows Let's find let's find one more example okay I these are this this is a really good example this is like a consolidation type of thing a lot of people get really caught up in this [ __ ] and I'll break down a couple more things that are really helpful in Breaking structure okay so let's say that we're trying to see a breaking structure to the downside why because we just identified that we broke structure to the upside okay so what are we going to do be doing we're going to be monitoring lows okay so right here move down then I move up now this is the low okay move down move down move down then I move up now this is the low okay move down then move up now this is the low okay we example boom Wick pubic hair underneath we don't care about it why we need a candle closure okay again this is a perfect example this candle I can't really tell if it Clos underneath this but would we care if this candle Clos underneath this low Pop Quiz Pop Quiz would we care if this candle let's just make this candle close underneath this low boom let's say this candle closed underneath that low would we care use your critical thinking skills here no we would not care why because there was a new low that was formed boom right here so do we take this low into consideration no we do not not we take the most recent low into consideration okay we form a new low right here and then price continues up and higher notice how we even though this is a jumble of candlesticks we still maintain bullish structure all throughout this consolidation this jumble couple more examples here okay this is a good one right here okay we break structure to the upside right here prior to being in a downtrend how do we know that we're in a downtrend because we Clos underneath this low okay boom downtrend what are we monitoring ing we're now monitoring monitoring highs this is a this is the example that I wanted to show you guys here so again let's think back what makes a high a move up then a move down okay so two Candlestick pattern move up then move down so blue candle then a black candle and if there's a unidentifiable dogee you kind of just use that as the middleman between the blue candle and the Black Candle so in this case this is the high is this the high Pop Quiz question for you guys no it's not why is this Candlestick not the high because it goes black candle Black Candle blue candle what's a high a move up then a move down this is not a high why because it's literally just two moves down we don't give a [ __ ] if it's little Candlestick Wick popped its head above here why because it's still not a high maybe on the lower time frames maybe on the one minute time frame it could be a high but right now we're looking at the 5 minute time frame okay so again boom this is our high move up move down we don't give a [ __ ] about this Wick how do we know that we break structure to the upside boom right here on this Candlestick closure right there now we're in an uptrend okay this is the low that we're monitoring okay we get moves up we don't really create any new lows after that and then what do we see boom price Wicks all the way down past this did this break structure no it did not why because this is plain and simple a Candlestick Wick this did not break structure it maintained bullet structure so boom now this is the low that we're monitoring do we see a break of structure after that no now this is the low that we're monitoring hey tjr why isn't it this candle because this is a move down then a move down how do we make a low a move down then a move up this is the low that we're monitoring oh so we broke structure right here no idiot use your eyeballs we made a new low over here move down then a move up bang now this is the low that we're considering when do we break structure on this right here and we can see that throughout all of this jumble some people might not be able to identify Market structure or any of that but we were able to sift through this just with our PL like literally with the simplest [ __ ] ever talking about pubic hairs and Candlestick closures that's all that we need to understand the most recent lows the most recent highs and if we close above them and if we close below them that's all break of structure is so when do we break structure do do we break structure on this Candlestick no because this Candlestick didn't close underneath this it was equal with this low when do we break structure on this Candlestick right here and then boom we can see price ends up moving down okay all right y'all if you guys found this video helpful make sure that you guys save this video and come back to it before jumping in a trade that could potentially blow your account lose your funded or lose you a bunch of money and if you guys want to learn more on how to become a profitable Trader I have a completely free free course Linked In the little description down below so you guys can check that out goes over pretty much every single Confluence including break of structure um talking about how I can actually put these confluences together to form a super solid strategy and I have a bunch of other more videos posted on this channel talking about different confluences talking about Break of structure and how you guys can actually take profitable trades using different strategies where I give a a free game out so be sure to check out those as well as always I appreciate you guys for watching I appreciate y'all I love y'all peace the [ __ ] out mate