Been trading for a while now, and one pattern I always keep an eye out for is what we call change of character trading - or CHoCh if you want the shorthand. It's basically your market's way of telling you a trend is about to flip, and honestly, once you start seeing it, you can't unsee it.

So here's the thing about change of character trading: it happens when price breaks through key structure levels and then flips the direction of the market waves. Think about it like this - if you're in an uptrend with higher highs and higher lows, that's bullish pressure, right? But the moment price breaks that higher high and then can't hold it, and instead creates a lower low, you've got your signal. That's the change of character happening in real time.

To actually spot this on your chart, follow the flow: first, identify what trend you're in using those higher or lower lows. Then watch for a break of structure - in a downtrend that's a lower low breaking, in an uptrend it's a higher high breaking. After that break, price will retrace and break the recent swing highs or lows depending on direction. Once all that lines up, boom - you've got your trend reversal. Your change of character trading pattern is confirmed.

I look at BTC/USDT a lot, and you see this play out all the time. You'll get a series of higher highs and higher lows building up, showing buyers are in control. Then suddenly the structure breaks, price pulls back, and instead of making another higher low, it creates a lower low. That's when you know the character has changed from bullish to bearish.

Now here's where it gets interesting for actual trading. I combine change of character trading with supply and demand zones, and this is where the real edge comes in. Once you confirm your trend reversal with the CHoCh pattern, you mark out a supply or demand zone from the recent wave action. Then you wait for price to come back and test that zone. That's your entry point. Stop loss goes a few pips on the other side of the zone, and you hold until another change of character forms in the opposite direction - that's your exit.

Why does this work? Because when you get a strong trend reversal confirmed by change of character trading, and you're trading from a legitimate supply or demand level, the risk-reward gets really attractive. Sometimes you catch the start of a major move, and those trades can be massive. The key is you've got to backtest this and only take setups in clean market conditions. In choppy, sideways markets, the pattern loses its edge.

Supply and demand is honestly my bread and butter, and when you layer in the change of character trading pattern with it, you're working with the structure of the market itself. That's the kind of confluence that separates high-probability setups from noise. Just make sure you're patient and selective about when you pull the trigger.