# The Market Structure Basics

Market trends are the **foundation of price movement**, and recognizing them is crucial for making informed trading decisions. A market moves in **three primary directions; uptrend, downtrend, or sideways (consolidation)**. These trends are identified by price action forming specific **swing points**:

* **Higher Highs (HH) & Higher Lows (HL) → Uptrend** 🚀
  * When price consistently forms **higher highs (HH)** and **higher lows (HL)**, it signals **bullish momentum**. This means buyers are in control, pushing prices higher with each retracement respecting previous support levels.
* **Lower Highs (LH) & Lower Lows (LL) → Downtrend** 📉
  * A **downtrend** is defined by **lower highs (LH)** and **lower lows (LL)**. This indicates **bearish control**, where sellers are dominating, driving prices lower after each weak pullback fails to break previous resistance.

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Now Choch ( Change of Character ) and BOS ( Break of strcuture ) indicate a potential change in trend.

* **🔹 Break of Structure (BOS)** → **Confirms trend continuation**
  * A **BOS** happens when price breaks a previous **Higher High (HH) in an uptrend** or a **Lower Low (LL) in a downtrend**.
  * This signals that the **current trend is still intact**, and the price is likely to continue in the same direction.
* **🔹 Change of Character (CHoCH)** → **Indicates potential trend reversal**
  * A **CHoCH** occurs when price **fails to create a new HH or LL** and instead forms a **Lower High (LH) in an uptrend** or a **Higher Low (HL) in a downtrend**.
  * This suggests a **shift in market momentum**, meaning a **possible reversal** is coming.\
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    TLDR;&#x20;
  * **BOS = Trend continuation** 📈📉
  * **CHoCH = Trend shift warning** 🚨
