Discussing the article: "Building an Internal and External Market Structure Indicator"
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Check out the new article: Building an Internal and External Market Structure Indicator.
The article presents a structured approach to external and internal market structure in MQL5, from swing identification to CHoCH/BoS validation within an established trend. It explains refining true highs/lows, enforcing “first internal signal” logic, and rendering lines, labels, and markers on the chart. The outcome is a consistent indicator that converts price structure into defined entries, stop losses, and 1.5R targets.
To identify the external structure, we use a larger swing lookback period. This means we compare each potential swing point against more candles before and after it. The purpose of using more bars is to filter out minor price movements and focus only on major market swings that define the overall trend. These major swings are then used to determine the external high and external low, which represent the dominant structure of the market. In contrast, the internal structure uses a smaller swing lookback period. Fewer candles are used when identifying internal swings so that smaller and more sensitive price movements can be captured. This allows the indicator to detect break of structure and change of character events earlier within the trend. The external structure shows the overall market direction. Internal structure captures short-term momentum shifts within that trend.
The indicator shows a swing low, swing high, higher low, and higher high for a bullish external structure. The External High (EXH) represents the higher high, while the External Low (EXL) represents the higher low.
Author: ALGOYIN LTD