How the chart looks using first/second test logic
1. Define the immediate trend (pink)
Left-hand action shows an upward swing → classify the short-term trend as up.
Draw the pink swings (swing high → pullback → swing high). That immediately tells you what “satisfying the trend” means (make higher highs / higher lows).
2. Mark significant horizontal levels (yellow)
There are clear levels where price reacted multiple times. Those are your level(s) to watch — they are where liquidity and orders accumulate.
On your chart the prominent yellow band is the level that gets tested twice.
3. Observe the first test
Price approaches the yellow level and fails at the first test (close/failure to break, rejection candle, or quick rejection after probing the level).
That failure clears orders (people get stopped out or tested) and gives the level information: sellers defended it / buyers were weak.
4. Observe the second test
Price returns to the same yellow level a second time.
If momentum is present on the second test (bigger rejection candle in the opposite direction, larger impulse candle after the test, quick follow-through), price will run through the level and make a new high/low, thus satisfying the trend.
On the chart: the second interaction with the level produces the decisive move (new high turned into rejection then a decisive drop to satisfy the new lower-trend).
5. Result
Trend is satisfied by making the new structure (new high or new low depending on whether momentum follows the second test).
You don’t need a “stop hunt” story — the price simply tested, failed, cleared liquidity, and the market moved to satisfy the trend.
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Simple practical checklist (apply to any chart)
1. Identify the immediate trend (draw 3-5 pink swings).
2. Mark repeated reaction levels (yellow horizontal lines where price reacted 2+ times).
3. Label the first test: did price probe and fail? (look for wick + rejection or failed close).
4. Watch the second test: look for evidence of momentum — bigger candle body, follow-through, volume spike (if you use volume).
5. If second test shows momentum → direction likely continues (enter on confirmation: e.g., after a follow-through candle closes on the satisfying side).
6. If second test fails → structural change (re-consider trend; that level held twice).
7. Manage risk: stop just beyond the test area; target at the next obvious swing or a 1:2+ reward ratio.
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Practical signals that show a true 1st vs 2nd test
1st test failure signs: long wick into level, close back away, small follow-through.
2nd test confirmation signs: impulsive candle in the expected direction, series of same-direction candles, momentum increase (size/slope), quick break of nearby structure (higher high / lower low).
If price simply chops on 2nd test with no follow through — it’s not confirmed.
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Final thought — why this is better for many traders
It’s simple, repeatable, and observational (no need to assume “stop hunts” or hidden intentions).
You focus on structure and behavior, not narratives.
Works on all timeframes because it’s pattern + momentum based.
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