Trading ranges Short
Failed bull breakout above a range
Just above a mature range high. Buyers break resistance but cannot sustain prices above it.
Read the sequence.
01 / OBSERVE → DECIDE
- ContextJust above a mature range high
- PressureBuyers break resistance but cannot sustain prices above it
- SetupJust above a mature range high. Require rejection or acceptance at the marked structure.
- DecisionReturn into the range followed by a bear trigger
The decision map
02 / QUICK REFERENCE- Location
- Just above a mature range high.
- Evidence
- Buyers break resistance but cannot sustain prices above it.
- Trigger
- Return into the range followed by a bear trigger.
- Invalidation
- Failure above the rejected breakout high.
- First objective
- Range midpoint.
- Pass when
- Price is accepting above the range in a strong bull breakout.
03 / THE FULL ARGUMENT
Thesis & participant logic
Supplied study draft · adapted Brooks-style prose, not a quotation from Al Brooks
The market is in a trading range. Price broke above the range high, but bulls failed to obtain follow-through and price returned inside. Breakout buyers are trapped, and range traders are selling high. I will sell below a bear reversal bar. My thesis is wrong above the failed-breakout high. I will target the midpoint first and the lower range if selling pressure strengthens.
04 / FROM IDEA TO A PLAN
Manage the thesis, not the need to be right.
Before entry
Write the structural invalidation and first realistic objective. Size to the loss you have already accepted, including costs and possible slippage. If the stop is unaffordable, reduce size or pass.
After entry
Reassess follow-through against the evidence above. Do not widen the stop or add because price “has gone too far.” A bounce to your average entry is not a market thesis.
At the objective
Range midpoint. Decide ahead of time whether to exit or retain a defined remainder. Continue only while structure and follow-through support the trade.
During review
Record the entry-time chart, planned risk, maximum adverse excursion, actual exit, and whether the thesis was invalidated. Judge the decision separately from the outcome.