Source-aware field guide · 20 answers
Market Structure and Price Context
Definitions for swing structure, trend, range and breakout language, with explicit rules for context and invalidation.
Published · reviewed for scope, source visibility and answer ownership
How to use this guide
Definitions for swing structure, trend, range and breakout language, with explicit rules for context and invalidation. The guide is written for traders, analysts, strategy researchers and charting engineers. The collection turns common price-action labels into testable observations. It does not claim that one taxonomy is universally correct.
Use every answer to resolve one operational question: Which observations define the current state, what would change that state, and how does the classifier avoid hindsight? Structure depends on timeframe, sampling, pivot logic and instrument. Labels from different settings should not be combined without reconciliation.
The supporting set is MetaTrader 5 Help — Technical indicators; MetaTrader 5 Help — Charts; CME Group — Technical analysis. These links provide standards, regulator material or official product documentation for the subject; they do not imply endorsement, worldwide applicability or a verified feature in a particular deployment. Check the current source, contract, configuration and qualified local advice before a production, trading or compliance decision.
What Is a Swing High?
A swing high is a local price peak identified by comparing a high with observations on each side under a stated pivot rule.
- Use it to
- Mark candidate and confirmed times separately so future bars are not used prematurely.
- Check the boundary
- The number of comparison bars changes both timing and the set of pivots.
What Is a Swing Low?
A swing low is a local price trough identified by comparing a low with observations on each side under a stated pivot rule.
- Use it to
- Record pivot strength, confirmation delay and source timeframe.
- Check the boundary
- Real-time confirmation occurs later than the plotted trough and can introduce look-ahead bias.
What Are Higher Highs and Higher Lows?
Higher highs and higher lows describe a sequence in which selected peaks and troughs rise relative to their predecessors.
- Use it to
- Define the pivot sequence, equality tolerance and state-change rule.
- Check the boundary
- Changing pivot sensitivity can turn the same chart into a trend or a range.
What Are Lower Highs and Lower Lows?
Lower highs and lower lows describe a sequence in which selected peaks and troughs fall relative to their predecessors.
- Use it to
- Identify confirmed swings and the exact comparison used for each label.
- Check the boundary
- One lower point does not necessarily establish a durable downtrend.
What Is a Trend?
A trend is a persistent directional tendency defined with a chosen price series, horizon and classification method.
- Use it to
- State whether direction comes from swings, returns, regression, averages or another rule.
- Check the boundary
- Different horizons can show opposite trends at the same time.
What Is a Trading Range?
A trading range is a period in which price remains largely between defined upper and lower boundaries under a chosen tolerance.
- Use it to
- Measure boundaries, duration, overshoot handling and the event that ends the state.
- Check the boundary
- Ranges can drift and their edges are zones rather than guaranteed execution prices.
What Is a Breakout?
A breakout is a move beyond a declared level or boundary that satisfies a specified price, time or volume confirmation rule.
- Use it to
- Define the boundary from information available before the move and record confirmation.
- Check the boundary
- An intrabar touch, close and sustained move are different breakout tests.
What Is a False Breakout?
A false breakout is a move that meets an initial boundary condition but later fails a declared follow-through or re-entry rule.
- Use it to
- Set the failure window and threshold before labeling historical cases.
- Check the boundary
- Without an advance rule, every losing breakout can be renamed false after the fact.
What Is Support?
Support is a price area identified by a method where buying interest or reduced selling has previously limited declines.
- Use it to
- Record the construction method, width, observations and invalidation condition.
- Check the boundary
- A historical reaction does not create an obligation for price to react again.
What Is Resistance?
Resistance is a price area identified by a method where selling interest or reduced buying has previously limited advances.
- Use it to
- Declare the zone, evidence, touch treatment and invalidation.
- Check the boundary
- Precise lines can imply accuracy that the underlying observations do not support.
What Is a Supply Zone?
A supply zone is a chart label for an area associated with prior selling pressure under a chosen price-action methodology.
- Use it to
- Define how the zone begins, ends, ages and becomes invalid.
- Check the boundary
- The chart cannot reveal every participant's unexecuted supply.
What Is a Demand Zone?
A demand zone is a chart label for an area associated with prior buying pressure under a chosen methodology.
- Use it to
- Record construction, width, freshness and invalidation rules.
- Check the boundary
- The label is an inference from price data rather than direct proof of waiting orders.
What Is a Break of Structure?
A break of structure is a methodology-specific label for price crossing a selected prior swing in the direction considered structurally significant.
- Use it to
- Identify the swing, required close or penetration and trend context.
- Check the boundary
- Different communities use the phrase differently and may disagree on the same chart.
What Is Change of Character?
Change of character is a methodology-specific label for an early price-structure event that may conflict with the prior directional sequence.
- Use it to
- Define the prior state, triggering swing and confirmation before testing it.
- Check the boundary
- The phrase is not a standardized market event and should not be presented as one.
What Is Consolidation?
Consolidation describes a period of comparatively contained or overlapping price movement under a chosen range or volatility rule.
- Use it to
- Quantify duration, compression, overlap and the event that ends consolidation.
- Check the boundary
- Low movement on one timeframe can contain a strong trend on another.
What Is Mean Reversion?
Mean reversion is a modeled tendency for a variable to move back toward a defined central level after deviations.
- Use it to
- Specify the variable, center, horizon, stationarity test and entry or exit rule.
- Check the boundary
- The mean can shift and a large deviation can reflect a new regime rather than mispricing.
What Is Price Momentum?
Price momentum describes the rate or persistence of directional price change over a selected horizon and calculation.
- Use it to
- Choose return definition, lookback, smoothing and comparison benchmark.
- Check the boundary
- Momentum measures are backward-looking and can reverse abruptly.
What Is a Volatility Regime?
A volatility regime is a classified state in which movement measures occupy a defined range or model state for a period.
- Use it to
- Declare the volatility measure, thresholds, transition rule and recalibration process.
- Check the boundary
- Regime boundaries are model choices and may change after new data arrives.
What Are Session Highs and Lows?
Session highs and lows are the maximum and minimum prices observed within an explicitly defined trading session and data source.
- Use it to
- Align the timezone, holiday calendar, instruments and included quote or trade fields.
- Check the boundary
- Different feeds and session cutoffs can produce different levels.
What Is a Fair Value Gap?
A fair value gap is a price-action label often applied when a three-candle sequence leaves limited overlap between the first and third candle ranges.
- Use it to
- Encode the exact range fields, minimum size, fill rule and timeframe.
- Check the boundary
- The term does not establish economic fair value or prove that price must revisit the area.
Primary and official references
These sources establish definitions, standards or official product behavior used across this guide. Follow the exact source and check its current version before a live implementation.