Lesson 5.2

True Breakouts vs False Breakouts

⏱ ± 1 min read · 👁 73 readers

Price breaking through a level is no guarantee that it will continue. A few things traders usually watch:

Reading breakouts and false breaks. Watch where price closes relative to the edge of the chosen area.
BelajarGold diagram. Click the image to enlarge.
  • Momentum: the breakout candle has a decisive body, not just a poke of the wick.
  • The close: price closes beyond the level on the reference timeframe, not merely touching it.
  • Retest: after breaking through, price often comes back to test the level from the new side before continuing.

False breakouts (fakeouts) often happen around news or when liquidity is thin.

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