The following document was originally drafted for an exclusive, closed-door quantitative trading group (SWMG). We did not sanitize these charts for this public release. They are raw, unedited internal notes. Apply this data ruthlessly.
Operator's Note (2026 Update)
Mastering pure price action is the foundation, but trading naked charts leaves you blind to where the actual orders are sitting. If you just want to draw ranges, any free platform will do. However, for operators looking to visualize true market liquidity directly on their charts, our desk heavily recommends TRDR. It overlays live orderbook data onto your setups, turning theoretical concepts like stalls and valid pivots into data-driven execution.
Price action refers to the change in prices of a security, and is often analyzed in terms of price patterns or fluctuations. Traders use price action as a technique to forecast future price movements by studying past market data, primarily price and volume.
Market Structure
Market structure refers to the characteristics of a market, including the number and relative strength of buyers and sellers, and levels of trading liquidity. It is often used to understand the behavior of a market and predict future trends.
The market structure varies across different timeframes. To understand ms, we examine past pivots (valid highs and lows). These provide us with a basis to form our bias.
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Hint: Typically, higher timeframes’ MS will be more respected, since HTFs attract more volume. Each pivot is only valid on the TF that it was observed, and all the TFs below. Example: A valid pivot in a 4h chart, should also be valid pivot in 2h, 1h, 45m, 30m…, 1m, 30s, 1s charts. So everyone who is trading 4h and lower TF will see that pivot. But a valid pivot that is recognizable only in the 1m chart, will only attract traders who use that timeframe and lower (30s, 10s, 1s ect).
Valid Pivots
Majority of traders fail to recognize a valid pivot from a bait pivot.
A valid pivot is a pivot that has made a MSB from a previous pivot.
A bait pivot is a pivot that is located between valid pivots and hasn’t made a MSB to either side.
FVG
A Fair Value Gap is a void of liquidity that was created by an imbalance between the buyers and sellers. Sometimes, one side is going to overtake the other causing an impulsive move and generating those gaps. Those gaps are significant since they tend to get retested in the future and can show psychology behind market participants.
Ranges & Trends
Market trends and then it ranges. Ranging is a form of accumulation and/or distribution before another directional trend.
When market is ranging, expect price to bounce back and forth between the high of the range and the low of the range.
When market is trending, expect price to give pullbacks/retraces but ms will continue to generate HHs and HLs (in a bullish trend) and LHs and LLs (in a bearish trend).
Ranges
EQ = Equilibrium, the middle point of the range.
Premium = Area of the range above EQ.
Discount = Area of the range below EQ.
Trends
Bullish: Series of HHs and HLs
Bearish: Series of LHs and LLs
Pullback/Retrace: A pullback or retrace is a temporary pause or reversal in the price of an asset within a larger trend, providing opportunities for traders to enter or manage positions.
Orderblocks
An OB is the last candle before an impulsive countermove. Orderblocks are often great areas of support and resistance and price usually retraces back to those levels, especially if they are followed by a FVG.
Breaker Blocks
A BB is a failed OB causing a significant shift in market liquidity and structure, signaling future market movements.
BBs that overlap FVGs will give you a setup. Expect BB that was supply/demand to act as demand/supply respectfully.
Patterns
Stalls
Price is likely to stall a high/low before reversing. When price does this, we have a bait high/low.
Never close a trade when it’s stalling your sl. It’s sad how many will exit a trade when price is stalling their sl to protect/save 0.1% of money invested into trade when they are already down 99%.
Stalls are a good sign of weakness or absorption. Price can stall a pivot to attract more liquidity from traders that are anticipating a breakout/nuke (msb and continuation) and use that liquidity to squeeze out those participants later. When price comes near a pivot and cannot break it, it simultaneously shows weakness from traders to break that level and continue the move.
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Hint: Stalls are POIs to enter a trade, not levels to close. If you are in a trade and you see price stalling your sl you either a) do nothing or b) add more to this trade (on specific scenarios) since stalls will give you the best RR imaginable on any trade.
