Trend and structure: BOS and ChoCH

Price never moves in a straight line. Movement is made of impulses (a strong push) and corrections (a pullback).

What a trend looks like

• Uptrend: each new high is above the previous one, and each low is above the previous low.
• Downtrend: highs and lows keep getting lower.

BOS — break of structure

Price closes above the last high in an uptrend (or below the last low in a downtrend). It means the trend continues: the side leading the market is still strong.

ChoCH — change of character

Price was going up but suddenly breaks below the last important low. This is the first sign of a reversal: sellers are taking control. In a downtrend it works the other way round.

In short: BOS — «follow the trend», ChoCH — «attention, a reversal is possible».