Market Structures Decoded: Beyond the Basics of HH, HL, LL, LH

NotFinancialAdviser · 2025-12-16T15:28:53+00:00

The essay discusses four fundamental price action patterns (HH, HL, LL, LH) that reveal market intent between buyers and sellers, emphasizing their significance in trading. It distinguishes between bullish and bearish movements, highlighting the importance of understanding these structures for effective trading strategies.

NotFinancialAdviser

2025-12-16 15:28:53

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These four patterns—HH, HL, LL, LH—form the foundational vocabulary of price action. Strip away all the fancy indicators and this is what remains: the raw conversation between buyers and sellers. Visible on any timeframe, these structures tell you everything about market intent.

Understanding the Foundation

On a BTC 45-minute chart, you’ll observe two primary directional frameworks:

Bullish Movement (HH & HL): When price marks Higher Highs paired with Higher Lows, the institutional players aren’t just pushing—they’re methodically establishing support levels. Each dip finds demand, each peak breaks resistance. This is controlled accumulation with teeth.

Bearish Movement (LL & LH): Conversely, Lower Lows combined with Lower Highs reveal systematic distribution. The hl and ll meaning becomes crystal clear: one shows retreating demand, the other shows falling resistance points. It’s destruction with precision.

Why This Matters for Trading

Most traders mistake pattern recognition for prediction. The real edge lies in interpretation. These structures expose:

When institutions execute ‘accumulation blitzes’ (aggressive buying phases)
When they orchestrate sharp capitulation (sudden selling pressure)
When consolidation offers genuine entry opportunities versus traps

The Critical Insight

Structure isn’t static geometry—it’s behavioral data. HH doesn’t equal strength; LL doesn’t equal weakness. False breakouts, hidden support levels, and psychological warfare hide inside these patterns. Tomorrow’s lesson explores how to separate genuine structural shifts from the noise.

Master this framework, and you read the market like a poker player reads opponents’ tells.

BTC0,12%

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