What it means
Use closes, not wicks. A wick beyond the level that falls back can be a liquidity sweep instead.
In practice
A break of structure is the market confirming its own trend: in an uptrend, a close above the last swing high. Traders use it to stay with the trend and to mark the pullback low that led to the break as the new level buyers must defend.
It is not usually an entry by itself. The common approach is to wait for the pullback after the break and enter from an area inside the leg that caused it, such as an order block or a fair value gap.
What to watch for
Buying the breakout candle itself often means buying the top of an impulse just before the pullback. Breaks on very low timeframes happen all the time and say little about the larger trend.
Related terms
3 terms- Change of characterThe first close against the trend through its last protected swing, an early sign the trend may be turning.
- Market structure shiftMSSICT's stricter change of character: a break against the trend that comes with displacement, often right after a liquidity sweep.
- Swing highA turning point whose high is above the highs on both sides (a swing low is the mirror).