LEVEL / RETEST
Breakout & Retest · confirm the break
Wait for a defined retest after a breakout rather than chasing every fast price move.
What is breaking out?
Mark an identifiable support or resistance level before trading. Specify which candle close confirms a break. A level drawn only after the move is not a reproducible rule.
Make the retest a condition
After a bullish break, this example waits for a pullback to former resistance. If the area holds and a completed candle confirms continuation, evaluate the entry. Without a retest, this variant produces no trade.
Stop, target and time limit
A possible stop sits below the confirmed retest low. Use the next premarked obstacle or a tested R-based rule for the target. Set a time limit for the retest. Re-establishment inside the old range invalidates the breakout thesis.
Why retests still fail
A retest does not eliminate false breaks. Repeated tests may weaken an area, and news can gap through it. Record both missed moves without retests and confirmed retests that subsequently stop out.
Challenge implementation
Treat the break and retest as one setup, not permission for unlimited re-entries. Set an attempt limit and deduct realised losses from the remaining daily buffer. A tighter stop does not automatically make a trade safer.
Planning example: resistance 100, break to 103 and retest to 100.2. A confirmed entry at 101 with invalidation at 99.8 risks 1.2 points. If the next obstacle is 102, only one point of target room remains before costs: an attractive pattern may still be a poor trade.
Before you trade
- Define the level and breakout confirmation beforehand.
- Fix retest, time window and attempt limit.
- Check target room after costs.
Common mistakes
- Chase despite requiring a retest.
- Treat every touch as confirmation.
- Ignore obstacles before the target.
RESEARCH & RULE CHECKS
Our examples are editorial planning frameworks. CME explains the relationship between stop distance and position size. FTMO illustrates why daily, overall and consistency rules must be read separately for the specific account.
IG / Breakout risk management ↗CME / Position sizing ↗FTMO / Trading objectives ↗Continue building your process.
Trend Following · follow the trend
Follow established trends with a defined direction filter, bounded losses and a preplanned method for trailing winners.
Open playbook ↗OPEN / BREAKOUTORB · Opening Range Breakout
Define the opening range and evaluate a confirmed breakout with an explicit session, stop and cancellation rule.
Open playbook ↗ICT / POWER OF THREEAMD · Accumulation, Manipulation, Distribution
ICT’s Power of Three framework: make consolidation, a possible false break and subsequent expansion observable and testable.
Open playbook ↗