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How to Trade Forex Fire Smart Money Concept

The concept of trading smart money revolves around identifying and following the actions of institutional investors and market professionals who possess significant capital and expertise. These experienced market participants often have access to extensive resources, advanced research, and insider information, allowing them to make informed trading decisions. By monitoring their activities, such as analyzing their large volume trades, positions, and overall market sentiment, individual traders can gain valuable insights into market trends and potential opportunities. Trading smart money involves recognizing patterns, trends, and signals generated by these influential players and leveraging that knowledge to make more informed trading decisions. By aligning oneself with the actions of smart money, traders aim to increase their chances of success in the financial markets.

Below are some simple guides to show how we can trade SMC

and understand the market we are trading.

Market Structure

In the forex market, market structure refers to the organization and patterns of price movements and key levels of support and resistance. Daily market structure in forex is typically observed by analyzing the price action over a 24-hour period. Traders often look for significant highs and lows, key pivot points, and consolidation zones to identify potential trading opportunities and determine the overall trend. On the other hand, the 4-hour (4h) market structure focuses on shorter time frames, providing traders with more detailed insights into intraday price movements. It helps identify more structure detail giving the trader a better understanding of whats really going on in the market. By analysing both daily and 4h market structures, traders can gain a comprehensive understanding of price dynamics and make more informed trading decisions. Below is a chart showing how price moves within the daily swings.

Image of Daily and 4 hour market structure
Image of 4 hour forex market structure
Image showing lower highs and lower lows in forex market structure

Finding entries within the trading range

Finding the trading range in the forex market chart involves identifying areas of price where there has been manipulation within the market which has led to an expansion giving a new lower low or higher high. Once the range is identified, traders can employ different strategies to trade within the range. One such approach is trading the order block, which involves identifying areas on the chart where manipulation has occurred. Traders can wait for price to retest these manipulation candles and look for confirmation signals such as bullish or bearish candlestick patterns or indicators to enter trades in the direction of the initial buying or selling pressure. By trading the order block within the established trading range, traders aim to capitalize on potential price reversals or bounces from these key levels.

Image showing a forex market trading range
Image showing a manipulation candle in the forex market
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