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Break and Retest Strategy (How to Trade It Clean)

The breakout itself is where most people get trapped. The retest is where you get confirmation and a cleaner risk-to-reward. Here’s the checklist that filters fakeouts and finds the clean retest entries.

Published: February 14, 2026 • Last updated: February 14, 2026 • Reading time: ~9 minutes
Break and retest diagram with breakout, pullback, and continuation.
Wait for the retest. Your edge is patience + structure.
Pillar guide • Core framework page. See all pillars: Trading pillar guides.
Definition (quick)

A break & retest is when price breaks a key level, comes back to retest it, and then continues. The retest gives you confirmation and a clean invalidation point, so you’re not chasing the breakout.

Quick checklist
  1. Pick a real level (range high/low, major swing, prior day/week).
  2. Confirm acceptance (break + close, hold beyond the zone).
  3. Wait for the retest trigger (hold, sweep+reclaim, micro shift).
  4. Invalidate beyond the zone; size risk before entry.
Rule: you don’t trade the break — you trade the retest with a clear trigger and invalidation.
Reality check: no breakout guarantees profit. Your edge comes from waiting for acceptance + retest proof.

What “break and retest” actually means

A break and retest is a simple idea: price breaks a key level, then returns to that level, and continues in the breakout direction. The retest is where you get confirmation and a cleaner invalidation point.

Step 1: Choose the right level

Not every line is worth retesting. Use levels that matter:

  • range highs/lows
  • prior day/week high/low
  • major swing highs/lows
  • clear structure flips (resistance → support, support → resistance)

Step 2: Confirm the breakout (avoid fakeouts)

Before you even look for a retest trade, demand evidence of acceptance:

  • Break + close beyond the zone on your execution timeframe.
  • Hold: price stays beyond the level for more than a single wick.
  • Momentum (optional): expansion candle(s) or rising volume if you watch it.

Step 3: Trade the retest (the clean entry)

The retest is where you upgrade randomness into structure. You’re waiting for price to interact with the broken level and show intent.

  • Retest hold: price tags the zone and holds, then starts to push away.
  • Sweep + reclaim: wick through the level, then closes back in the breakout direction.
  • Micro structure shift: lower highs stop forming (bear → bull), or higher lows stop forming (bull → bear).

Invalidation (where the idea is wrong)

Invalidation belongs beyond the retest zone. If price returns through the level and holds on the wrong side, the breakout thesis is invalid.

Common traps (and how to avoid them)

  • Chasing the break: you enter at the worst price. Wait for the retest.
  • Retest never comes: skip it. No retest = no trade.
  • Retest is too deep: if it re-enters the prior range and accepts, the setup is degraded.

A copy/paste prompt for break & retest

Analyze this chart screenshot for a break-and-retest setup.

1) Identify the key level being broken and why it matters
2) Confirm breakout: what evidence shows acceptance?
3) Retest plan: trigger + invalidation + target zone
4) List the main fakeout risk and what would invalidate the setup.

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