How do you determine the daily retracement?

• A. After a new daily lower low price will accumulate orders to begin the pullback, then wait for 4h/1h BOS
• B. After a new daily higher high price, immediate continuation
• C. After a break of weekly structure
• D. After a new daily lower high, wait for 15m signals

Answer: (A)

In a downtrend, a daily retracement is a pullback that happens after a new daily lower low forms. When that new low appears, the market often sweeps liquidity and gathers orders to fuel the next leg down, setting up a brief rally or pullback on lower timeframes. The key step is waiting for confirmation that the pullback is over and the downward move can resume, which is shown by a break of structure on a shorter timeframe such as the 4-hour or 1-hour chart. This combination—a new daily lower low followed by an orderly pullback and then a lower-timeframe break of structure—is how the daily retracement is identified and traded.

Why the other ideas don’t fit: a new daily higher high would indicate upside pressure or a potential reversal, not the continuation of a daily retracement in a downtrend. A break of weekly structure signals a change in the bigger, long-term trend rather than the immediate daily pullback setup. Waiting for very short-term signals on a 15-minute chart without the corroborating lower-timeframe structure break can lead to premature entries and misses the clearer confirmation of the retracement ending.