what is choch in trading

what is choch in trading

1 year ago 32
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A ChoCh in trading, short for "change of character," is an initial shift in order flow that can sometimes signal a short or long-term price reversal for an asset, equity, or currency pair. It is a reversal pattern that traders use on higher time frames for market direction and on lower time frames to start looking for trades. ChoChs are used to identify moments when the markets typical behavior transforms, and they can be valuable trend reversal patterns for traders. To use a ChoCh, traders look for a shift in order flow on the time frames they trade. However, ChoChs should not be relied on solely for getting market direction or looking for confirmations on lower time frames. Instead, traders should use a stack of confluences to ensure they have picked a good point of interest and have a good sense of the market direction. ChoChs can be used in different trading styles, such as price action traders and indicator-based traders, to identify market trends and entry opportunities.

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