A false break occurs when price looks to breakout of a support or resistance level, but snaps back in the other direction, false breaking a large portion of the market out. When prices begin to breakout higher a large portion of the market starts to look for the resistance to break and will enter long trades, often setting their stop loss on the other side of the resistance.
- Can be traded on many time frames
- Can be used in many markets and pairs
- Can be traded with many triggers as the major entry
- Often entering when the majority of the market has been stopped out entering in the wrong direction