Breakout retest BULLISH

What a breakout retest is

A breakout retest adds one chapter to the plain breakout: after price breaks resistance, it returns to the broken level, holds there, and turns higher again. The retest converts the old ceiling into a floor — "resistance becomes support," one of the oldest observations in technical analysis.

The psychology behind it

The pullback after a breakout is driven by quick profit-taking and by skeptics fading what they see as a false move. What happens at the old level decides everything. If the breakout was genuine, three groups defend it: breakout buyers adding at better prices, prior sellers who regret selling and re-enter, and shorts covering at breakeven. If the level holds, the market has effectively voted twice on the same price — which is why retest entries are considered higher-conviction, at the cost of sometimes missing moves that never look back.

How MKTDATA detects it

The template encodes the full sequence — rise, break, dip back toward the trigger zone, hold, and turn — and the engine scores the live path against it with the same shape, volume and momentum weights used across the library. Because the pattern is also matched at partial completion, a stock that has broken out and is currently dipping back can appear as Forming or Tracking while the retest is still in progress.

Trading notes

Retest traders typically enter as the level holds, with invalidation just below the retested zone — one of the tighter risk structures in pattern trading. The main failure mode is the deep retest that slices straight through the old level: that usually marks a false breakout, and the pattern flips to Failed. Not every breakout retests; strong moves sometimes never return, which is the trade-off for the improved entry.