I want to share something game-changing for your trading. There are four price action patterns that are super important to understand, and these patterns are not just theories—they are used by professional traders every day.

Starting with the most basic. HH or Higher High is when a new peak is higher than the previous peak. Looks simple, right? But this is a clear bullish sign. Buyers are in control, and the upward momentum is still strong. How to trade it? Wait for a pullback to support or the HL area, then enter a buy. Don’t go against this trend by looking for a short.

Next, HL—and this is very important—is a new higher low compared to the previous low. HL indicates that buyers still have control; they won’t let the price break support. When HL is well-formed, it’s the best entry point to buy. Place your stop loss below that new low and let it run.

Now, if you see a pattern of HH followed by HL, then HH again, then HL again? That’s a very healthy uptrend. It’s not just rising, but rising in a structured and sustainable way. Buying on every rebound is a very good opportunity.

Switching to bearish now. LL or Lower Low is a new low lower than the previous low. Sellers are starting to dominate. Enter from the LH area and place your stop loss above the previous peak. LH or Lower High is a new peak lower than the previous peak—this is a warning that buying momentum is weakening. Don’t force a buy when LH appears; it’s a dangerous zone.

If the pattern continues with LH, LL, LH, LL? That’s a strong downtrend. The opportunity to sell is very good, but buying here is risky.

Now, the most important thing—and this is what confuses beginner traders—is not the symbols themselves, but the sequence. The sequence determines the trend direction. A strong uptrend is HH → HL → HH → HL. A strong downtrend is LH → LL → LH → LL. And if you see HH → LH → LL? That’s the start of a reversal; the trend is changing direction.

How to practically apply this? Wait until the trend sequence is clear. Only then trade in the direction of the trend. In an uptrend, enter when HL forms. In a downtrend, enter when LH forms. Place stop loss below HL when buying, above LH when selling. Simple, but effective.

I see many traders overthink this. But if you can correctly identify patterns of HH, HL, LL, LH and respect their sequence, your win rate will increase significantly. This isn’t magic; it’s real market structure. Try applying this to your charts and see for yourself.