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Professional Concepts

Market Structure and Order Flow

Market structure describes a trend using only its sequence of swing points: an uptrend is a series of higher highs and higher lows, and a downtrend is a series of lower highs and lower lows. As long as that pattern holds, the trend is considered intact.

A "break of structure" happens when that pattern fails — for example, an uptrend printing a lower low for the first time — and is often treated as the earliest objective sign that the prevailing trend may be changing.

Order flow builds on this by looking at how price moves between those structural points — whether moves are sharp and one-directional, suggesting strong participation, or slow and choppy, suggesting hesitation or balance between buyers and sellers.

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