All language subtitles for 4.0 - 3 Types of Structure Theory

Now that we have a firm grasp on
market structure in identifying and

understanding trending markets and how
they create higher highs and higher

lows for bullish trends and lower lows
and lower highs for bearish trends.

We can now move on to the three different
types of structure and what they represent

when we're building our overall picture
of structure in the previous videos.

We're mentioning market structure.

In the example of higher highs and
higher lows for a bull trend, we

were referring to swing structure.

And what swing structure is, is the
larger structural ranges that are created

when price is trending, whether that's
making higher highs and higher lows or

lower lows and lower highs, we use swing
structure as the basis of understanding

our overall trend when we're looking
at analyzing any financial market.

And when we're looking at that swing
structure, that's where we get the large.

Impulses or expansions to the upside
or downside followed by some sort of

correction or complex pullback before we
end up breaking the previous swing high

or previous swing load in a bear trend.

And ultimately what swing structure is
gonna allow us to do, especially from

my higher timeframe perspective, is
it's gonna give us an overall bias as

an overall structure to work with an
understanding where price is likely to.

Now we can move on to
what sub-structure is.

And I had mentioned briefly what
sub-structure was in the previous

videos, but more specifically what
sub-structure is, is it's the corrective

structure within the overall swing range.

So as we can see, our swing range is
between this slow and this high and

any price action that happens within.

The low and the high of the swing
structure would be considered sub

structure and more specifically
the corrective price action that

we're seeing the counter trend.

So in this case, because we're in say
a bull trend, we had already made a

previous high, we broke that high we've
pulled back, and now we've created a

new high we're expecting some sort of
higher, low to form before we've run.

The previous higher high to create a new,
higher high, and as a result, we need to

put in some sort of downward price action.

So in order to make that higher, low,
we need price to correctively move.

Counter trend.

So in this case, downwards and the
formation of that, the structure that

is created is called substructure.

And as we can see, our swing structure is
bullish, but our sub-structure is bearish.

So the swing structure we're creating
higher highs and higher lows.

And the sub-structure with contained
within this swing structure of this low.

And this high is creating lower
lows, lower highs, lower lows, lower

highs, lower lows, and we're able to
understand sub structure and plan out.

Where we would expect a reasonable
pullback and we use sub structure to

create the understanding that we know
that when price creates say a higher

high, more than likely what price is
then going to do is going to retrace or

correct in a counter trend fashion to
put in a higher, low once the higher,

low has been established price will
then continue moving to the upside and

eventually break the previous high point.

So what we can do with the substructure
is begin to develop ideas of where

price is likely to react off.

Putting in that higher, low, and
then continuing to the upside.

Now, there would be a few different
areas or a few different situations that

we can use sub structure to understand
where price is likely to react.

So in a bull trend, if there was a
demand zone within the swing structured

leg that were caught in currently more
than likely, that would be a reaction

point for a higher, low to form.

Another option or area that price
could see a higher, low form.

And the continuation of the trend is if
liquidity is created and then swept by a

higher, low, and then continuing to the
upside, we can have the combination of

liquidity being swept and a demand zone
being tapped into to continue the trend.

And what we can have is the
combination of all that.

The sweep of liquidity, the
reaction of the demand zone, and

then a supply and demand zone flip
that we could look to enter on.

Now, of course we haven't actually
discussed supply and demand zone

flips or liquidity concepts as of yet.

So don't stress too much about that.

We will be getting into that in
future videos, but those are the

main things we would be looking for
as sub structures being created.

We're trying to gauge.

The impulsive leg of the swing structure
to figure out where price is likely to

react off of, to put in that higher,
low, and then continue to the upside.

If the trend is to remain bullish
and put in a new, higher high.

So once we've established sub-structure,
we can see that price is trading

within this range of this swing low.

And this swing high price begins to
correctively move to the downside,

which is known as our substructure.

Once we see a change of characters,
so we were creating lower lows.

And lower highs once that paradigm
shifts and we start to put in higher

highs and higher lows, we're able
to, we're able to conclude that

a change of character has begun.

We've switched from.

Bearish sub structure to
bullish minor structure.

And the minor structure is in essence,
the pro trend structure that's

contained within the swing structure.

So again, all of this price action
that's happening between the swing

high and the swing low is what
we would call a complex pullback.

And we're able to delineate
the two different groupings of

structure within the impulsive.

Range of the swing structure as sub
structure for the counter trend pullback

and minor structure as the pro trend
move that hasn't quite broken the

high as of yet, but we're starting
to see that shift in order flow.

We're starting to see that
shift in the overall structure.

So we're able to use minor structure.

To gauge that change of character
and start to understand that we

were putting in lower lows and
lower highs within the swing range.

And we're now starting to put
in higher highs and higher lows.

So again, like I said, with sub
structure, we can use that to gauge

where a higher, low is going to form
by looking for demand zones, sweeps of

liquidity, the combination of demand
zones and sweeps of liquidity, as well as.

Supply and demand zone flip zones.

And then we can take that a step
further with the minor structures.

Now that we've seen a reaction
point, we're starting to

see a change of character.

We can start to look at price moving
to the upside, and this is where we can

start to look at continuation type trades.

So when we're looking at swing structure,
we're under the understanding that we're

creating higher highs and higher lows.

We know that when we create a higher
high we're expecting a pullback, and

if the trend is to remain bullish,
we would expect a new hire high that

takes out the previous hire high.

So then when we're looking at
price action in that corrective.

Which is counter trend.

That's forming our new, higher,
low that we're anticipating.

We can use sub structure to
understand what's happening there.

To then look at the impulsive leg to
determine where a demand zone has been

created, or if a demand zone doesn't
exist or price reacts off of say a,

a sweep of liquidity, then we can
start to look for potential entries.

Now, of course, if we didn't want to
look for entries at that point, because

we didn't have enough confirmation,
but we don't necessarily have to look

for entries at that particular point
at that higher, low, we don't have

to be the first ones into a trade.

We can wait for additional confirmation.

So once we get that actual
change of character, we are going

from lower lows to lower highs.

And now we're starting to switch.

We created a new, higher high
after breaking this lower high,

we have that change of character.

We're starting to develop minor structure.

And once we get that minor structure, we
can start to look for entries, to look at

attacking at least the previous swing high
and continuing to make a new, higher high.

If the trend is to remain bullish and
the same would, we said for a bear

trend where we have an impulsive swing
structure, we have our swing low.

We have our swing high price would
be making a series of higher highs

and higher lows sub structure.

And then once we break a piece of
sub sub structure where we violated

this higher, low, we have now created
a lower, low we're now starting to

see minor structure playing out.

And then once we break.

The lower low of the swing structure.

We can see that price is continuing
on in that overall bearish trend.

Now, one other thing to notes is looking
at sub structure and minor structure

is not gonna be an end all be all.

It's just to create a framework
and an understanding of what is

happening between the swing structure.

What is happening when we're putting
in a higher, low, or a lower high,

depending on a bolt trend or a bear trend.

What we may see is an
impulsive move to the upside.

We might see.

Correcting creating sub-structure.

We see that change of character.

We might even get a new high or high, and
we're starting to look for entries and

then price could continue down creating
more sub-structure and then continuing to

the upside and actually breaking the high.

Because as we said in the previous market
structure, videos, as long as this low is

not violated, we're still in a bull trend.

Price can range.

All throughout this entire impulsive
leg of the swing structure and still

continue and break the high to be valid.

So although we had our change of
character right here, we're starting

to see minor structure playing out.

What we can see is then we had
another change of character

creating lower lows and lower highs.

So we're creating lower
lows and lower highs.

Then we started creating
higher highs and higher lows.

So we had sub structure here.

We have minor structure here.

And then we switch back creating
lower lows and lower high.

So we switch back to sub structure
and then we start creating

higher highs and higher lows.

We get our change of character
right here, and then we eventually

do break the swing high.

And this is something that
you will see on the charts.

And at the end of the day, you're not
gonna get an a hundred percent rate.

The markets are moving in the
way that they do their collecting

orders, structures being created,
whether it be swing structure,

substructure, and minor structure.

Again, we can create sub structure.

Start creating minor structure and then
create more sub-structure and we'll

be able to touch on this a lot more.

Once we jump into the liquidity segments
and we'll discuss in the liquidity

section, how we can filter out or at least
have a better edge on when sub-structure

is being created, it switches to minor
structure, but then switches back to

sub-structure and then minor structure.

Before we actually break the swing high.

Like I said, a couple different things
that we would use with when substructures

being created is looking for demand zones.

What might happen is we have
demand zone at a low, lower point.

We're building liquidity and
price needs to switch back to

substructure to actually come down.

But in order to do that, we
need to create liquidity again.

I'm speaking a little bit.

Turn in terms of liquidity, we are
gonna dive into liquidity in so

much detail in the next section.

So stay tuned for that.

But until then, this is just to get your,
your mind thinking as you're navigating

the charts, as you're looking at these
three different types of structure.

So again, swing structure is gonna
be your key structure and identifying

your overall trending market
structure that you'll be following

the sub structure is the counter.

Structure within that swing range
between in this example, the

higher high and the higher low.

So the sub structure is gonna form
our higher, low in a bull trend

or a lower high in a bear trend.

And then finally, the minor structure
is the pro swing trend structure,

which is looking to run the weak swing
structures, whether it be the high

or high or the lower, low, depending
if it's a bull trend or a bear trend.

And one final thing to note, just
to be able to clearly delineate

the difference between sub
structured and minor structure.

Sub structure ends and minor
structure begins when there is

a change of character in price.

So again, with a bullish example,
sub structure is creating

lower lows and lower highs.

A change of character happens
creating a new, higher high.

So it violates the previous lower
high that was being printed.

And then we start to see a shift.

It creating higher highs and higher lows.

So once we see that initial change
of character, that's when we're

starting to create minor structure
as seen in this graphic right here.

So what I recommend now is taking
a look at your charts, especially

the ones that you would have
mapped out in the market structure.

Example of the course.

start identifying your swing structures,
start identifying sub structure, minor

structure, and really understanding the
difference between the two and begin

to get more comfortable with the idea
of what substructure represents on a

chart when it switches to minor and
how we can look to anticipate, say a

previous swing high being taken out to
form a new, higher high by using the

concept of where the sub structure is.

And then once it switches
to minor structure.

And then one other thing that you can
also do is start looking at your swing

structure legs and start mapping out
your demand zones and seeing how demand

zones in a bull trend, for instance,
line up with your sub structure in

terms of where price reacts off of,
and being able to start identifying

when a demand zone is likely to get
facilitated, because what you might find.

There might be a few different demand
zones within the impulsive range.

And it's all about understanding
the sub structure initially as

price is continuing to correct
to the downside in a bolt trend.

And again, you can, you can look to enter
on any of these demand zones, if you

wish, but looking for extra confluence
price, tapping into a demand zone and

seeing that change of character is going
to give you the best insight in terms

of framing up and building a trade.

But again, that's what I recommend
doing is just mapping out your swing

structure, mapping out the sub structure,
mapping out the minor structure

and just getting comfortable with
understanding what's happening between

these swing points, this low and this
high, when price is seemingly moving

in between with not breaking structure.

because if not, what we're likely
to be doing is just waiting

for price to do something.

And we're gonna be guessing at which
demand zones to pick or guessing

where price is on a chart to make an
informed trading decision this way.

If we're more in line
with what's happening.

On these three different types of
structure, we can make better decisions

and then build better quality trade
decisions and just understand order

flow at a higher level, because it's so
important to understand these concepts

apply them to the charts, cuz at the
end of the day, understanding your swing

structure is gonna give you your trend.

Understanding your sub structure
is gonna allow you to know

where likely turning points.

Bound to happen.

And then minor structure is going to
allow you to see that continuation of

the trend that would in theory, allow
price to in this case, run the previous

swing high to form a new higher high.