
Tradeologist
February 19, 2025 at 12:40 PM
SMC (Smart Money Concepts) Structure Mapping in trading refers to analyzing price action to identify key market structures, liquidity zones, and institutional footprints. It helps traders understand where "smart money" (institutions, banks, and big players) is likely to be active.
Key Components of SMC Structure Mapping:
1. Market Structure (MS) – Identifying trends (Bullish/Bearish) and structure shifts.
Higher Highs (HH) & Higher Lows (HL) – Uptrend
Lower Highs (LH) & Lower Lows (LL) – Downtrend
Break of Structure (BOS) – Confirms trend continuation.
Change of Character (ChoCh/CHoCH) – Indicates potential trend reversal.
2. Liquidity Zones – Areas where price is likely to be manipulated.
Buy-side Liquidity (BSL) – Above resistance (stop-loss orders).
Sell-side Liquidity (SSL) – Below support (stop-loss orders).
3. Order Blocks (OB) – Last bullish or bearish candle before a strong move.
Bullish OB – Price likely to bounce up.
Bearish OB – Price likely to drop.
4. Fair Value Gaps (FVGs) – Areas of price inefficiency where price might return.
5. Mitigation Zones – Where institutions re-enter positions after manipulation.
How to Use SMC Structure Mapping in Trading?
1. Identify Market Structure: Look for HH-HL in uptrends or LH-LL in downtrends.
2. Mark Liquidity Zones: Spot areas where stop hunts may happen.
3. Find Order Blocks: Locate strong OBs for potential trade entries.
4. Watch for CHoCH & BOS: Determine trend continuation or reversal.
5. Use FVGs & Mitigation Levels: Predict price corrections and re-entries.
Would you like a chart example or a deeper breakdown of any concept?
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