No Shift = No Trade

Introduction to No Shift = No Trade

In trading, a shift refers to a clear transition in market structure that signals a change in direction or trend. Without this confirmation, entering a trade is considered high-risk because the market may still be within a continuation phase rather than a reversal.

This principle ensures traders avoid impulsive decisions and focus on trades backed by strong structural evidence.

Key Components in the Chart

1. External High/Low:
   • Represent the extreme points of the market structure.
   • These levels provide context for potential reversals or continuations.
2. BOS (Break of Structure):
   • Indicates the market has broken a significant level, suggesting a continuation in the current trend.
3. Shift:
   • A structural change or CHoCH indicating a potential reversal.
   • This is the critical signal to consider before trading.
4. Low Probability POI:
   • Zones where trades are less likely to succeed due to the absence of a structural shift.
   • Highlighted with an “X” on the left chart.
5. High Probability POI:
   • Zones where trades are more likely to succeed because they align with a confirmed shift.
   • Highlighted with a checkmark on the right chart.

Trade Setup Idea

Scenario 1: Low Probability POI (Avoid Trade)

• Market Structure:
  • The price moves up but does not show a valid external shift.
  • This suggests the trend is not yet ready to reverse.
• Action:
  • Avoid trading in this zone. Wait for a clearer signal.

Scenario 2: High Probability POI (Enter Trade)

• Market Structure:
  • The price shows a valid shift (CHoCH), indicating a reversal.
  • A new BOS confirms the directional bias.
• Entry Point:
  • Enter near the high-probability POI (typically near resistance or a retracement after the shift).
• Stop Loss:
  • Place the stop loss above the external high or below the external low (depending on the direction of the trade).
• Take Profit:
  • Target the next significant structural level or external low.

Risk Management Tips

• Patience: Wait for a clear shift before entering the trade.
• Confluence: Combine the shift with other indicators (e.g., volume or candlesticks) for additional confirmation.
• Stop Loss: Always use a stop loss to protect against unexpected moves.

This structured approach helps traders focus on high-probability setups while avoiding unnecessary risks.