Breakout and retest: confirming a breakout
A breakout and retest is a three-step sequence: price breaks through a well-defined level, comes back to test it from the other side, and holds. The retest is the confirmation many traders wait for.
How to spot it
- 1Start with a clear, well-tested level.
- 2Look for a decisive close beyond it.
- 3Watch for a return to the level.
- 4A hold, with old resistance acting as support (or vice versa), completes the pattern.
Common mistakes
- ✕Chasing the breakout candle far from the level.
- ✕Calling a deep reclaim a 'retest' when it's a failed breakout.
- ✕Using weak, rarely-tested levels.
The Breakout & Retest lens checks the level, the break, the retest and the hold as separate graded rules.
Educational content only. Not financial advice. No pattern or concept guarantees any outcome.
Keep learning
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In smart money concepts, an order block is the last down candle before a strong move up (bullish) or the last up candle before a strong move down (bearish).
Market structure is the sequence of swing highs and lows.
Support is an area where buying has stepped in before, slowing or reversing declines.
A demand zone is a base that price left sharply upward; a supply zone is a base price left sharply downward.
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