Finding the correct daily bias is one of the important part of trading. Many traders become confused because market can move up and down several times in lower time frame. Due to this, trader may change their bias again and again.
The TTrades Fractal Model gives a simple framework to identify daily bias. The main idea is not to predict every market movement. It mainly focuses on avoiding reversal day and trading the expansion day.
This model uses a swing point formation and daily candle structure to create a one-sided market narrative.
What is TTrades Fractal Model?
TTrades Fractal Model is a price action framework based on the formation of a swing point.
The model mainly uses three daily candles.
The first candle creates the initial market context.
The second candle normally acts as reversal or rejection candle.
The third candle gives expansion from the reversal point.
In some condition, a fourth candle may continue the same directional movement.
The main trading opportunity is generally searched during Candle 3.
Swing Point Framework
The basic swing point framework contains three important candles.
Candle 1– Initial Context
Candle 1 starts the formation.
It gives initial direction and creates the price range around the swing point.
At this stage, trader mainly observe the market structure.
No clear expansion bias may be confirmed yet.
Candle 2– Reversal or Rejection Candle
Candle 2 is the important reversal candle.
Price may take previous high or low and then reject from that area.
In lower time frame, this movement may appear like a V-shaped reversal.
The market can become very noisy during this candle.
Many fakeouts and fast directional changes may occur.
For this reason, Candle 2 is generally avoided for trading.
The main purpose is to allow the reversal candle to complete first.
Candle 3– Expansion Candle
Candle 3 is the primary trade candle of the model.
After Candle 2 rejection, price starts to expand away from the swing point.
The directional bias becomes more clear.
Trader now looks for trade only towards the expected expansion side.
For example–
If Candle 2 forms a swing low and price rejects higher, Candle 3 may give bullish expansion.
If Candle 2 forms a swing high and rejects lower, Candle 3 may give bearish expansion.
This helps to maintain one-sided daily bias.
Candle 4– Continuation Candle
Sometimes price continues its movement after Candle 3.
This forms Candle 4 continuation.
The same directional expansion may continue towards another liquidity level or higher time frame objective.
However, Candle 4 is not compulsory in every setup.
Why Candle 2 Should Be Avoided?
Candle 2 is mainly the reversal phase of the model.
During this period, price may move in both directions.
Previous high or low may be taken.
Lower time frame traders may see multiple bullish and bearish signals.
This creates clutter and confusion.
A trader may enter bullish and suddenly market reverse bearish.
Then again price may reverse towards bullish side.
Instead of predicting the reversal candle, the model waits for Candle 2 to close.
After its completion, the trader can focus on expansion from the established swing point.
So less guessing is required.
Wick Logic in Daily Bias
Daily candle wick can also give important information about the next market movement.
A small wick may indicate a cleaner directional expansion.
When daily candle forms a small wick on one side, a larger body may develop towards the opposite side.
For example–
Small lower wick may support bullish daily expansion.
Small upper wick may support bearish daily expansion.
The idea is that price spends less time moving against the expected direction.
Then the candle body expands in one clear side.
This wick logic can help the trader understand the expected daily candle profile.
Invalidation and Fakeout
Not every movement against the bias means the trading idea is immediately invalid.
Trader must understand the difference between real invalidation and a temporary fakeout.
Invalidation
Suppose bullish expansion is expected.
Price takes a previous level and then aggressively moves lower.
The market fails to recover and continues expanding against the bullish narrative.
In this situation, the original bullish idea may be invalidated.
The same concept works for bearish bias.
Strong movement against the expected direction can indicate that the original swing point idea is no longer valid.
Fakeout
Sometimes price temporarily moves against the bias.
It may retest a key level or move inside the wick range.
The 50% area of the wick can become important.
Price may trade inside this area and then resume the original directional movement.
This may be considered a potential fakeout rather than full invalidation.
For example–
Bullish bias is expected.
Price moves slightly lower.
It retests a key level around the 50% wick area.
Then price strongly continues higher.
The lower movement was mainly a temporary fakeout.
Use of Daily Profiles
After identifying the expected daily expansion, trader can use different daily profiles for entry timing.
Some common profiles are–
Asian Reversal– Price creates an important move or reversal during Asian session.
London Reversal– London session takes liquidity and forms directional reversal.
New York Reversal– Price creates reversal during New York session and then expands.
The daily profile helps to understand when the expected movement may start.
The trader does not need to trade every session.
Only the session which supports the daily Candle 3 narrative is important.
Lower Time Frame Trade Execution
Daily chart is mainly used for directional bias.
After Candle 2 closes, trader can move into lower time frame.
The 1-hour chart can be used to find specific entry area.
Trader may search for–
Order Block– A price area from where strong directional movement started.
Fair Value Gap– An imbalance area created during fast market expansion.
Liquidity Level– Previous high or low where market may collect resting orders.
The lower time frame setup should support the daily expansion direction.
For example–
Daily Candle 3 bias is bullish.
Trader moves to 1-hour chart.
Price retraces into bullish Order Block or Fair Value Gap.
A bullish entry can be searched from that area.
The trader should generally avoid taking bearish trades against the expected daily expansion.
Example of Bullish Daily Bias
Suppose EUR/USD is forming a daily swing low.
Candle 1 creates the initial context.
Candle 2 moves below the previous low and then rejects strongly higher.
The daily candle finally closes.
Now the trader waits for Candle 3.
The expectation is bullish expansion away from the swing low.
On the 1-hour chart, price retraces into a bullish Fair Value Gap.
The trader can look for bullish entry.
The main target may be previous daily high or another liquidity area above price.
The whole trade is based on one bullish narrative.
Example of Bearish Daily Bias
Suppose Gold forms a daily swing high.
Candle 2 trades above a previous high and rejects lower.
After Candle 2 closes, bearish expansion is expected.
Candle 3 becomes the primary trading candle.
Trader moves into 1-hour time frame.
Price retraces into a bearish Order Block.
A bearish setup can be searched from this area.
The trader now mainly focuses on sell-side opportunities.
This reduces unnecessary bullish and bearish switching.
Importance of Patience
Patience is one of the main requirement of this model.
The trader must wait for Candle 2 to completely print.
This can sometimes feel difficult.
Price may already show a strong reversal in lower time frame.
Trader may feel that the move will be missed.
But entering during Candle 2 means trading inside the reversal process.
The direction is still developing.
Waiting for the daily candle close removes much of the guesswork.
After Candle 2 is completed, the swing point becomes more visible.
Then the trader can focus on the Candle 3 expansion.
The cost of the strategy is mainly waiting.
But this waiting helps to avoid many low-quality reversal trades and fake directional signals.
Final Concept
The TTrades Fractal Model gives a simple method for finding daily bias.
The trader first identifies the daily swing point structure.
Candle 2 is treated as the reversal or rejection candle and mostly avoided.
After Candle 2 closes, Candle 3 becomes the main expansion candle.
Daily wick logic, daily profile and lower time frame entry models can be used for confirmation.
The main objective is to remove market noise.
Instead of continuously changing bullish and bearish bias, the trader follows one directional narrative.
Wait for the reversal.
Confirm the swing point.
Then trade the expansion.