BREAKOUTS & FAKEOUTS

FAKEOUT:

Price breaks an area, retail traders immediately believe it is going

in that area.

REAL TREND:

Breakout, retest, and continuation.

NO RETEST, NO ENTRY. Remember to identify your key levels,
as that will be the area you will be looking at for a retest.

EXAMPLE:

In the illustration below, you can see price heading in an uptrend

near a key level. You could easily encounter a fakeout at the point
where it is too risky to enter, that is why you need to be patient
before entering. Price will always retest the level. What matters is
if price will continue its direction of an uptrend, or go back down.

THERE STILL HAS NOT BEEN A RETEST,

BUT YOU MAY ENTER HERE

SAFE TO
GET IN HERE

IT IS TOO RISKY TO GET IN HERE, AS

PRICE IS BREAKING A KEY LEVEL