How to Understand Market Structure
Part 1 — What Market Structure Really Is
Once we know how to read a price chart, identify a trend, and mark support and resistance, the next important step comes.
Understanding how the market moves inside a trend.
🔹 Market structure is not an indicator
Market structure:
🟡 is not a tool
🟡 is not a signal
🟡 is not a strategy
It is a way to understand how the market moves.
🔹 Price does not move randomly
Price movement consists of two parts:
🟡 impulse
🟡 correction
Impulse = direction
Correction = pause
Both are natural.
Both are necessary.
🔹 What is an impulse
An impulse is a movement where:
🟡 price moves strongly in one direction
🟡 candles show a clear direction
🟡 the market shows initiative
An impulse moves the structure forward.
🔹 What is a correction
A correction is a phase where:
🟡 price slows down
🟡 the market takes a pause
🟡 profits are being taken
A correction is not a reversal.
It is a normal part of a trend.
🔹 Structure in an uptrend
In an uptrend, we see:
🟡 higher highs
🟡 higher lows
The impulse creates a new high.
The correction forms a higher low.
🔹 Structure in a downtrend
In a downtrend, we see:
🟡 lower lows
🟡 lower highs
Again:
impulse → movement
correction → pause
🔹 The most common mistake
The most common mistake is confusing a correction with a trend change.
Every trend:
🟡 breathes
🟡 slows down
🟡 continues
Without corrections, a trend cannot exist.
🔹 Summary
Market structure:
🟡 describes how price moves
🟡 helps distinguish impulse from correction
🟡 gives context to the entire chart
It does not tell you when to enter.
It helps you understand what is happening.
❓ When you look at price movement,
can you recognize
whether it is an impulse or a correction❓