Trends/Gaps and breakouts

False breakout

Price closes outside a range or level, then closes back inside within a few bars.

Gaps and breakoutsBest on 3M, 6MAlso called fakeout, failed breakout

Illustration of the false breakout shape. It is a sketch, not real price data.

What it shows

A false breakout is when price closes above a resistance level (or below support) but within 3 bars closes back on the other side of it. The move outside did not last.

It is a description of what happened. The rule is applied after the fact and can be shown for the last several bars.

How we find it

The same code that draws it on your chart follows these steps, with the same result every time.

Find a level, such as a 40-bar high.
Mark a close beyond it by at least 0.5%.
Check price closes back through the level within 3 bars.
Mark the failed move.

Starting values: Level 40-bar high or low; Margin 0.5%; Return within 3 bars. These are proposed and will be tuned on real price data before launch.

How to read it

The dashed line is the level.
Price crossed above it, then closed back below.
The gold dot marks the failed close.

Status labels you may see

Label	What it means
Recent	A failed break in the last 10 bars.
Break holding	Last close beyond the level, still within 3 bars.
None	None found.

What cancels it

Applies once price is back inside.

What traders check next

Volume on the break.
Whether the level is retested again.
Size of the move.

Limits

Defined only after it fails.
Margins and bars are choices.
Many breakouts retest without failing.

Try it in forecastviz

Open any ticker and choose Gaps and breakouts → False breakout in the left menu.
Switch between 3M, 6M to see how the picture changes.
Compare with Trendline break and retest and Role reversal on the same chart.

Open on a ticker

Questions

Can I know in real time?

Only after the return.

Why does it happen?

We make no claim.