Dictionary

False breakout

Price moving beyond a level, triggering breakout orders, and then failing to hold, returning inside the prior range.

Breakout and retest. Price stalls under the same level several times, pushes above it, then drops back to touch it from above before carrying on. That touch is the retest, where the old ceiling is tried as a floor. A break that falls straight back under it is a false breakout.

False breakouts are common enough that in many markets they are the base case rather than the exception. The level was visible, orders were resting beyond it, they were filled, and there was no sustained demand behind them.

Traders respond in three ways: waiting for a close beyond the level rather than a touch, waiting for a retest that holds, or deliberately trading the failure itself once price reclaims the level. Each trades timing against reliability.

The one thing that does not work is assuming a breakout is real because the pattern looked clean. Decide in advance what would confirm the break, what would invalidate it, and how long you will give it, because a failed breakout usually reverses quickly. See failed-pattern and bull-trap.

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