Introduction
Understanding market structure is essential for any trader who wants to read price action with clarity. If you’ve already studied the basics of market structure and liquidity concepts, this guide builds on that foundation. Here, we’ll break down short-term, intermediate-term, and long-term highs and lows, and explain how they work together within price action.
Short-Term Highs and Lows
A short-term low forms when a swing low has a higher low on each side of it. Conversely, a short-term high is created when a swing high has a lower high on each side.
These are the building blocks of market structure. Every shift, trend, and reaction stems from short-term formations.
Intermediate-Term Highs and Lows
Intermediate-term highs and lows are simply multiple short term highs and lows that create stronger pivot points:
An intermediate-term low forms when a short-term low has another short-term low to its left and right.
An intermediate-term high forms when a short-term high has another short-term high to its left and right.
There are two types:
Basic intermediate-term structures (built off short-term swings).
- Rebalanced intermediate-term structures (formed when price rebalances a fair value gap and trades away).
Long-Term Highs and Lows
Long-term structures are anchored on higher time frame reactions.
A long-term low is confirmed when price reacts from a higher timeframe level, then forms a short-term low on each side.
A long-term high follows the same logic but off a higher timeframe level.
Once long-term highs or lows are set, traders anticipate intermediate-term and short-term structure shifts around them.
Identifying Market Shifts
Market structure shifts (MSS) and breaks of structure (BOS) are clearer once you know the hierarchy:
Short-term highs/lows show local price reactions.
Intermediate-term highs/lows confirm stronger pivots and sweeps (protected swings).
Long-term highs/lows set the broader framework for where price is likely heading.
Using Market Structure in Practice
When the market is clean, fair value gaps and order blocks can provide clear trade setups. But when price is choppy, advanced market structure helps filter entries:
Look for short-term highs/lows to confirm shifts.
Use intermediate-term sweeps as confirmation of continuation or reversal.
Anchor expectations around long-term levels drawn from higher timeframes.
This layered approach prevents premature entries and helps align trades with broader price delivery.
Key Takeaways
Short-term highs/lows are the foundation.
Intermediate-term structures confirm strength and sweeps.
Long-term highs/lows are tied to higher timeframe reactions.
Advanced market structure helps navigate messy price action when clean imbalances are absent.
