Major reversals Long
Major trend reversal from bear to bull
Failed low retest after a bear trend-line break. Bears cannot resume the trend after a meaningful bull response.
Read the sequence.
01 / OBSERVE → DECIDE
- ContextFailed low retest after a bear trend-line break
- PressureBears cannot resume the trend after a meaningful bull response
- SetupFailed low retest after a bear trend-line break. Require rejection or acceptance at the marked structure.
- DecisionBull trigger after the higher low or failed new low
The decision map
02 / QUICK REFERENCE- Location
- Failed low retest after a bear trend-line break.
- Evidence
- Bears cannot resume the trend after a meaningful bull response.
- Trigger
- Bull trigger after the higher low or failed new low.
- Invalidation
- Break below the retest low.
- First objective
- Prior lower high or nearest resistance.
- Pass when
- Buying a trend-line break without a failed resumption test.
03 / THE FULL ARGUMENT
Thesis & participant logic
Supplied study draft · adapted Brooks-style prose, not a quotation from Al Brooks
The market has been Always In Short, but selling pressure is weakening. Bulls broke the bear trend line with strength. Bears retested the low but failed to resume the trend, forming a higher low or failed breakdown. I will buy above a bull signal bar after the failed test. My thesis is wrong below the retest low. I will target the prior lower high, EMA and possible measured move.
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
Prior lower high or nearest resistance. 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.