STAGE 2 · LESSON 2 OF 5

Trends, ranges and market regimes

Market structure is a descriptive framework, not a guaranteed prediction.

THE IDEA~8–12 MINUTES

Understand it

A trend may be described by a sequence of higher swing highs and lows, while a range oscillates between approximate areas. Those labels depend on the timeframe and the swing rule you choose. Trends can contain deep retracements, and breakouts frequently fail. Define the conditions that change your classification rather than deciding after you see the outcome.

WORKED EXAMPLE

If a five-minute chart makes three higher highs but the daily chart is falling, both observations can be true. Each answers a different timeframe question.

Watch for this misconception

Changing the definition of a trend to fit the trade you already want.

PRACTICE EXERCISE

Write an objective rule for a swing high using a fixed number of bars on each side.

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KNOWLEDGE CHECK

Why should trend criteria be defined before testing?

Select the best answer

Check the sources

Hypothetical educational examples. Verify current product specifications and rules before making decisions.