YouTube Transcript:
Boot Camp Day 6: Break of Structure

well it's good baby
I know you love seeing my beautiful face
every damn morning
what's good baby welcome to boot camp
day [ __ ]
day six
I believe
welcome to boot camp day six okay today
we're back on it with trading okay we
are going to be talking about Break of
structure okay
um I figured you know we're gonna get
the the baby the beginners right out
hold on there's a fly
we're gonna get the baby we're gonna get
the beginner [ __ ] out of here
um first so we can start getting into
this because right after this one right
after this trading video the next
trading video is going to be talking
about liquidity so we can actually get
into some [ __ ] all right so
first we need to understand break of
structure because we've talked about
candlesticks so we know the little
drawings on the chart and now we know
Trends right now we need to understand
why and when the Market's trending and
you know when it actually switches
Direction when it breaks structure when
it's when it gets a market structure
shift okay so the simplest way
that I can describe a break of structure
is a shift in the trend okay so we know
right Trends move and higher highs and
higher lows okay we also know
um or actually I haven't even talked
about this okay so so Trends move in in
higher highs and higher lows okay right
and then lower lows and lower highs on
the contrary right in a downtrend okay
what makes up a high in the first place
this is something that I didn't talk
about in the trends because I was going
to save it for the break of structure
video okay so what makes a high a move
up then I move down right
hi what makes low a move down then a
move up low Okay so
when we apply this to the charts okay it
is literally as simple as that a high
okay is a move up then they move down a
low is a move down then a move up
okay so what does that mean it only
takes two candles essentially it's a
Candlestick pattern so if there is one
green candle up and then a red candle
down
that's a high if there is one red candle
down and then one green candle up that's
a low it's not it doesn't have to make a
perfect little [ __ ] shape okay it
doesn't have to look perfect it doesn't
have to look pretty because I feel like
a lot of people a lot of beginner
Traders especially think highs and lows
have to be like you know like look
exactly the same right so let's let's
jump into the charts
and start outlining
what a high and low even looks like
before we even get into breakup
structure because we have to understand
what highs and lows look like in order
to understand what a breaking structure
is right because if that means the trend
is changing if we're if we're saying a
trend is higher highs and higher lows
and the trend changes we have to know
what those highs and lows even look like
right so
this is a perfect example of an odd
looking high that people probably
wouldn't even call a high people would
probably call call this the high no okay
it's not you can't just Lump Lump them
together that's not how this [ __ ] works
okay
so first of all right we do have a move
up then a move down what does it consist
of literally a blue candle than a Black
Candle my my chart is blue and black it
just looks cool that way okay that's why
I have it okay so this is a high
right this right here is the high off
the Wicks of the blue candle right there
perfect that's a high
okay and on the contrary right we have a
move down then they move up so what is
this a low
cool cool right this again is still a
high it just doesn't look as pretty as
this right why because we have a blue
candle meaning a move up and then a move
down okay it's two candles and you're
probably going to say well tjr where's
the high is it off the wick of this
candle or is it off the wick of this
candle well since a high takes two
candles to form you're going to take the
highest Wick of whichever of those two
candles it is
okay so boom we got a high right here
okay and same thing same thing down here
right if this blue candle's Wick was
lower
then the Black Candle
that would be the low makes sense cool
good we got it hopefully I don't have to
cover that
um hopefully I don't have to cover that
again okay we can go over another
example what is this this is a high why
because there's a blue candle then a
Black Candle literally It Only Takes Two
candles to make it hot perfect boom we
find the the top Wick between between
the two candles done deal okay
this is a low why because there's a move
down then a move up
this is a low why because there's a move
down then there's a move up
cool
cool same thing right here
this is a low why because there was a
move down then they move up
right if we scale into the four hour
and look at this
this is the low right it makes sense
that this would be the low and not
and not the start of the Black Candle or
not the wick of the Black Candle because
if we zoom in
and look at it
what the [ __ ] is that right this ain't
no low the low's all the way down here
okay
so boom we know what lows and Highs are
now perfect
clap it up we got we got like the super
beginner [ __ ] done okay
perfect
all right we know what lows are high
what lows and Highs are and if we know
what trends are and if we know what lows
and Highs are then we can know when a
trend breaks and when Market structure
shifts okay why because if a uptrend
moves in higher highs and higher lows
but then uh oh
it doesn't anymore it ends up breaking
what is likely going to happen
okay it's going to start making lower
lows and lower highs
and that is what we call a break of
structure
okay meaning we break the trend that the
current market that market is currently
in
okay
we break that Trend and then flip flip
Market Direction flip Market structure
in the other direction
okay
and break of structure is very very
simple but for some reason I get lots of
questions on it and in this video I will
try and
simplify this [ __ ] so literally a child
can understand it okay I'm going to try
and make this super simple
okay a break in structure
to the upside
okay and we'll and we'll show examples
of this on the on the chart and
um and through drawing okay a breakup
structure to the upside so that means
there is a downtrend currently
right a break of structure to the upside
is when we have a closure
a candle closure not a wick a candle
closure
above a high
remember what's a high a move up then a
move down so that means in order for it
to break structure to the upside we have
to see a single candle close fully
meaning closing Above This High meaning
the candle body has to be above the wick
of the high
makes sense let's find an example on the
chart because I'm not sure this makes
sense yet because this is how I
described the last video and we still
had questions but that's okay questions
are good gonna try and help you guys
understand this
okay
so right here we're going to move up
then a move down then a move up okay
perfect we made a low right here and as
you can see right here we had like a
miniature uptrend okay we come down get
a move down then a move up we get
another low cool
I no longer care about this previous low
I'm only caring about the most recent
one okay and we'll get into that a
little bit later into this video okay I
only care about the most recent high or
low that has been made
as you can see here we previously
had broke structure to the upside right
uptrend okay
then we have this low and what happens
right we have a
move down then I move up but then right
we weren't we weren't in a downtrend
previously but what happens with this
candle
the body of the candle
closed
below the low
so what happened what what did it cause
it to do
started a downtrend
right boom lower high lower low probably
going up to form a lower high or
retracement on the weekly time frame to
come up in within here
okay
so
do are we starting to understand what a
break of structure is now let's try and
find a break of structure to the upside
this is just lovely
right what happens we were previously
training up this gives us two perfect
examples of this previously trending to
the upside right we see
a low what happened to the low the body
of the candle closed below it what
happened to the trend it shifted right
we have a high right here we have a low
right here where's the next high right
here where's the next low right here
lower low
lower low lower high
what's this right here I move down then
I move up that's a low
what's this right here move up then I
move down that's a high what's this a
lower high a lower low wow would you
look at that it's a trend it's a
downtrend because Market structure broke
okay so now that we're in a downtrend
what happens over here
we have
a high right here and you're gonna say
oh yeah it broke whoa whoa whoa slow
down we also had a high right here why
why why is this a high guys why is it a
high because we have a move up and then
they move down
we get a closure above it
okay close the candle closed above the
wick
and then what happens
Bing Bong moves to the upside
yeah we did get a retracement down but
hey look high or low
higher high higher low higher hot higher
low higher high higher low
continues okay
that is breaking structure to the upside
now
let's break your structure to the
downside
well it's when we have an uptrend
and then schminck a low gets taken out
right same exact thing just in the
opposite direction
right
low gets taken out
okay
boom we start the downtrend okay
pretty pretty simple stuff right
let me show you guys what a break of
structure is not and I think this is
where a lot of people slip up
right here is a perfect prime time
example of this
right here we get a move up then I move
down so what does this make a high
correct
right here we get a move up
and then I move down this Wick goes
higher than this Wick right so
technically this high is higher than
this high
however we do not give no [ __ ] we do
not give a crap we do not care about Wix
going above highs or going below lows
that does not mean anything to us
we need a candle closed because as you
can see right here
oh oh no it's a higher high what's gonna
happen oh no it falls what this isn't
what tjr taught us well here we are
teaching you this [ __ ] okay so we get
this Wick going higher than this Wick
but we don't care because it doesn't
close above it it is not a break of
structure unless the candle closes above
it write that down it is not a break of
structure unless the candle closes above
a high
or be low a low
right for a for example if let's say
this black Wick let's say this this Wick
went lower than this low
that would not have been a break of
structure it that would not have been a
breakup structure
and this whole thing wasn't a break of
structure until
this most recent low
got closed below
that's all breakup structure is
whatever the most recent
okay ready so we'll simplify this even
more right it's literally a step-by-step
execution of understanding where a break
of structure is number one identify that
the trend identify the trend
we'll we'll even write this down this
will be good
damn
can be profitable but can't type
that's how it goes
is that even the way how to spell
structure I don't even know and I don't
care how to spot breaking structure
number one
identify the trend
okay where is it going number two okay
up
Trend or down
trend
okay number two if in up Trend okay
we are watching
the lows right because if we're moving
up higher and higher when are we going
to get a break of structure
when the low gets taken out when the low
gets closed below we don't care about
the highs right we care about the lows
okay number three if in downtrend we are
watching highs right for opposite reason
right we're moving down so the only way
for this thing to turn into an uptrend
right is it for it to go higher right if
it keeps going lower we're staying in
the trend got it got it okay number four
okay once you identify the trend right
we figure it out
we can't okay
in order for it to be a break
again I misspelled it in order for it to
be a break of structure to the upside
it has to close above or actually we'll
make this be a brake structure of the
downside because we talked about we're
watching loads for the first one I don't
want to confuse you guys
wow I can't even type
so in order for it to be a break of
structure to the downsize to the
downside which means it is turning from
an uptrend into a downtrend damn I
wonder if I can make this smaller
there we go
it has to close below the most recent
low
does that make sense
give me a a nod yes yes okay number five
oops number five so this is that exact
same
just opposite
let's see if I can spell it right
structure did it for me a lot I love
technology oops I was just copying
upside
into an uptrend oops bad grammar on a
instead of an
in order for it to be a break of
structure to the upside which means from
a downtrend into an uptrend I'll even
add that into there because that can get
confusing I know
okay
cool so in order for it to be a break of
structure to the downside which means an
uptrend into a downtrend it has to close
below the most recent low
understand that we are consistently
watching the most recent lows in the
most recent highs getting formed okay we
are not we are not listening or carrying
caring about pass lows okay so in this
example this gives us a a perfect
example okay
right we make this low right here this
low yes it's lower than this one
but why do I not care about it anymore
because this one is the most recent low
that was made
yes price ended up closing below both of
them so we wouldn't have had an issue
but I know damn well that some of you
guys if it only closed below this one
and not below this one you guys would
have been having a heart attack
shivering your [ __ ] Timbers deciding
whether or not to take a short
okay so we take the most recent lower
high made
okay same thing with this
same thing with this over there right we
have a high right here
oh we make another high right here
why why is this why why aren't tjr why
are we using the wick of this this
because
up candle and a down candle how do we
Mark our highs the highest point of
those two candles
all right the wick right there we got it
we closed above that yes we closed above
both of these yet again
however
we don't care about this High anymore
okay there will be times when price will
consolidate right not within a trend
right it'll just be consolidating and
you'll see a lot of that right you'll
see oh
move up right
right here move up then to move down now
this is a high move down then a move up
this is a low move up then I move down
this is a high move down then to move up
this is a low right this is just pure
consolidation there is no Trend within
however many days this was this would
have been a terrible trading week for
Gold right there was no Trend within
this there was no break of structure
Market had no clue where it wanted to go
oops
okay
does that make sense
I feel like that that is the easiest way
that I could have put brake of structure
at all okay we we have it laid out it is
a step-by-step formula number one
identify the trend
what's the trend
look at it
lower lows and lower highs perfect we're
in a downtrend
okay so we are in a downtrend what are
we watching
we are watching highs where's our most
recent High
right here
so in order for this to turn into an
uptrend again
we have to wait for the daily time frame
to close above here
we just gotta sit back relax and wait
this week is not a high this Wick is not
a hive this candle forming is not a high
if the next if the next candle that
forms is down though
then yeah we'll move the high to there
but that hasn't happened so where's the
most recent High
there cool and when does it turn into an
uptrend when we get a candle closure
above there
okay we'll show we'll show one more
example
of a break of structure
let me throw this on the weekly
yeah oh this is money
okay
right here
right we're trending up
all right or actually no well we'll go
into like 15 minute time frame
this will be good
and again remember guys remember
remember I don't want you to watch this
breakup structure video and instantly be
like when there's a break of structure
it means it's gonna go up forever or
when there's a breaking structure to the
downside it's going to go down forever
because that is not true at all
not not true
okay not true whatsoever
because remember in our Trends video if
you have to re-watch that today I highly
suggest you do so remember in our Trends
video
the weekly holds more power than the
daily the monthly holds more power than
the weekly if we see a break of
structure to the downside on The Daily
like we saw right here on gold or sorry
on on gu
right
and why is this the breaker structure
the downside
move down move up this is the low
we close below that market starts
running down if we see a breaking
structure to the downside on The Daily
but the weekly we're still bullish
it's just a retracement
was this a break of structure
little little homework little tip and
trick for you guys
this was the most recent low that we had
is this a break of structure
no
why is it not a break of structure
you're probably saying
shut up we haven't closed below the low
we didn't close below this is a perfect
example
of what a lot of you guys will be
entering on
that just is not a breakup structure
this looks like a liquidity sweep
and oftentimes Mike Market will do this
a lot to fake people out who think that
a wick below
a previous low is actually a break of
structure
because what's Market probably going to
do it's probably going to come up a
little bit
okay yeah maybe the next weekly candle
will close below here maybe if it wants
to but we have to wait for that we can't
just say
good enough sell right because we don't
want it to be good enough we want to
know
and because even when we know for
certain we don't actually know so why
would we why would we take a trade off
of something that's already low
probability of being a break of
structure
and already being in a market that's
already very difficult to have a high
probability to trade in right we're
literally just reducing our chances of
being a higher probability Trader by
taking
bad setups like this
right we need to wait for the low to get
closed below
same [ __ ] with this
same [ __ ] with this this is a an exact
example of this right here
same thing with this
right what's this move down then move up
this is a low at one point in time at
one point in time this Black Candle
right here
this was full a full Black Candle to the
downside it looked like this
I know I know damn well
that ninety percent of retailers were
just short it's going down forever
and then what happens Market never
[ __ ] breaks structure and we push
higher
same thing here
right
we gonna move down then move up
no break move down then move up
no break
and Mark it continues to push Higher and
Higher and Higher and Higher and Higher
because the trend never was broken
Trend never broke
and what were these these were just
liquidity sweeps and we will learn about
that next time
okay
hopefully that covered break of
structure for you guys
it has to be a close let's go back to
that
that little thing that we had shrink uh
let's do this on The Daily
and let's drag this all the way up here
identify the trend is it going up is it
going down is it going in higher highs
and higher lows is it going in lower
highs or lower lows
boom I literally made a checklist for
y'all figure it out okay perfect it's in
an uptrend if it's in an uptrend we are
watching the lows perfect Hawkeye those
things
watch every single new low that gets
made okay that's actually something that
I want
because we only care about the recent
ones that get made
those are the only ones we care about
okay those are the only ones we care
about those are the only ones that need
closure above because who gives a [ __ ]
right
if Market's moving like this or
right I mean we showed it in that GJ
chart but if markets moving higher highs
higher lows
and then and then one of the logs gets
Wicked below but it keeps going higher
we don't care about that right because
Market structure never was broken we
only care if it gets closed below
right also right sorry for the most
recent low Point okay we're going like
this
right who cares about this low if this
new low was already made
if it's supposed to move in higher highs
and higher lows than the most recent low
gets broken gets closed below then that
means the the structure is shift who
cares about this one it means we we made
a new low we made a lower low compared
to this one
who gives the [ __ ] about this this was
the trend this was the most recent low
no one cares about this low no one cares
about this High we care about the most
recent ones that were made
same thing for the downtrend okay please
please drill that into your head
and I suggest you guys write this down
okay so we know that
we're in an uptrend and if we're in an
uptrend we're watching the lows
we're watching the most recent ones that
get made and we forget about the old
ones okay after the most recent one gets
the most recent ones get made
and then once it's a break of structure
to the downside in an uptrend it has to
close the candle has to close below that
most recent low
and that's it that's breaking structure
we got it okay so what I want you guys
to do for homework
is
find 10 examples of breaks of structure
this should be very very easy because
it's pretty easy to spot especially with
this checklist
find 10 examples of an actual break of
structure within the market and then
find 10 examples of what someone a noob
who hasn't watched this course who
hasn't watched this video yet who hasn't
watched my how to spot a break of
structure uh in the market video
find 10 examples of what someone might
consider a break of structure but
actually is it a wick below a low or
like a wick above a high right something
that might fake somebody out
that someone might believe is a break of
structure but isn't so you guys can get
good at spotting actual breaks of
structures
and then fakes
okay
do those two things you need you need to
have 20 examples
by the end of this okay until you're
done with your homework you need 10
examples of breaks of structure and 10
examples of fake outs or fake breaks of
structure okay not real
all right that's your homework
make sure you get it done before
tomorrow's video I'll see you boys
tomorrow