Standard breakout trading often leads to "fakeouts," where the price briefly crosses a level only to reverse instantly. Waiting for a retest provides:
Place a limit order at the broken level or wait for a bullish/bearish reversal candle on a lower timeframe to trigger your entry. 4. Risk Management break and retest strategy pdf download
The break and retest is a price action strategy that identifies when an asset breaks through a significant level of support or resistance, then returns to that same level to "test" it before continuing in the new direction. It relies on the concept of role reversal: becomes New Support . Former Support becomes New Resistance . Standard breakout trading often leads to "fakeouts," where