These 4 simple steps will help you do market structure mapping on a Gold XAUUSD chart.

This method works on any time frame and is completely suitable for beginners in SMC.

Let me show you how to use that, taking XAUUSD on a 4H time frame as an example.

Step 1

Opening any time frame on Gold chart, the first thing that we will need to do is to find a significant price movement.

It can be an impulse or a wave.

• An impulse leg is one strong directional movement.

• A wave is a sequence of price movements that compose a trend.

In our example, we have a strong bearish impulse.

It will be a base for a market structure mapping.

The identification of a significant price movement is the most important step in market structure mapping.

Such a price move will be used as a reference for any structure that we will map.

Step 2

Find significant highs and lows.

I am talking about the points where significant price movement completed or from where they are initiated.

I marked such highs and lows with flags.

Step 3

Draw impulse legs.

Connect highs and lows that you identified, drawing impulse legs.

If you are an experienced trader, you can skip this step.

Here are impulse legs based on highs and lows that I marked.

Mapping impulse legs helps newbie traders better orient themselves in the market and better understand a current sentiment.

Step 4

Map highs and lows depending on their positioning relative to the wave or impulse that we identified in Step 1.

The impulse leg that we found in Step 1 is a base movement.

• Its high will always be called Higher High.

• Its low will always be called Lower Low.

We will map the second high and low that we identified in relation to high and low of that base movement.

• Our second high is lower than the first one, so it will be a Lower High LH.

• Our second low is higher than the first low, so it will be a Higher Low HL.

Using the same logic, the following highs and lows will be mapped in relation to previous ones.

When you map all the highs and lows after the base movement, market structure mapping is completed.

Structure Mapping is the Core

Market structure mapping is the essential element of profitable SMC trading Gold XAUUSD. Your ability to correctly map significant highs and lows is crucially important for spotting significant events like break of structure and change of character.

I hope this guide will help!