Which phrase best defines Break of Structure?

Which phrase best defines Break of Structure?

• A. When price forms a new high without any pullback.
• B. When price surpasses a previous peak in an uptrend or falls below a previous bottom in a downtrend.
• C. When price retraces to the 50% Fibonacci level.
• D. When price forms a double top.

Answer: (B)

Break of structure happens when price clearly violates the established price swings by pushing beyond the last swing point—in an uptrend that means making a new peak above the previous high, and in a downtrend it means dropping below the previous low. This shows momentum has shifted and the current price pattern is being “broken,” signaling a potential continuation or reversal based on the new momentum. The best description is that price surpasses a previous peak in an uptrend or falls below a previous bottom in a downtrend. The other ideas don’t pinpoint that exact breach: a plain new high without reference to the prior swing point isn’t as precise, Fibonacci retracements focus on pullbacks, and a double top is a pattern, not the act of breaking the structure itself.

Break of structure happens when price clearly violates the established price swings by pushing beyond the last swing point—in an uptrend that means making a new peak above the previous high, and in a downtrend it means dropping below the previous low. This shows momentum has shifted and the current price pattern is being “broken,” signaling a potential continuation or reversal based on the new momentum. The best description is that price surpasses a previous peak in an uptrend or falls below a previous bottom in a downtrend. The other ideas don’t pinpoint that exact breach: a plain new high without reference to the prior swing point isn’t as precise, Fibonacci retracements focus on pullbacks, and a double top is a pattern, not the act of breaking the structure itself.