Glossary
Swing high and swing low HH · HL · LH · LL
In short
A swing high is a peak with lower highs on both sides, a swing low a trough with higher lows on both sides. Together they are the building blocks of market structure.
The four labels
- HH – higher high: above the previous swing high
- HL – higher low: above the previous swing low
- LH – lower high: below the previous swing high
- LL – lower low: below the previous swing low
A swing needs confirmation
A swing is only confirmed once enough candles have formed on its right side. Until then it can still change. Indicators that mark swings before they are confirmed have to move them later – that is one form of repainting.
Why swings matter
Many traders place their stop losses just beyond swing highs and lows. That makes these points pools of liquidity, and it is why breaks and sweeps of swings are watched so closely.