Mastering Retests: How to Enter with Confirmation After a Breakout

Jasper Osita - Market Analyst

2025-07-15 11:06:13

Goal of This Lesson:

To help you time high-probability entries after a breakout using retests—removing FOMO, improving entry price, and increasing your edge as a price action trader.

Real-Life Analogy

Imagine a boxer lands a clean punch (the breakout).

The opponent staggers—but then regains footing and circles back.

That’s the retest.

If the boxer strikes again and the opponent goes down—you had confirmation.

Don’t bet on the first punch. Wait for the second blow that proves the fight is yours.

Why Retests Matter in Price Action

Not all breakouts fly. Even valid breakouts often return to the breakout zone before continuing. This return move is called the retest.

In price action terms, a retest serves two critical purposes:

Confirms the breakout was valid (support becomes resistance, or vice versa)
Provides a cleaner and a good risk-reward ratio entry point

What Is a Retest?

A retest happens when price breaks a key level (resistance or support), then returns to that same level and either:

Bounces off it (confirming the level flip), or
Consolidates briefly before continuing in the breakout direction.

This forms the classic break-and-retest pattern.

Retest vs. Pullback – What’s the Difference?

While both involve price moving “backward,” they serve different structural purposes:

Feature	Retest	Pullback
Purpose	Confirms breakout or S/R flip	Temporary correction in ongoing trend
Location	At the breakout level (S/R flip zone)	Usually deeper, into internal structure or moving average
Timing	Immediately after a breakout	Occurs after trend continuation or extended move
Behavior	Often sharp, single candle, low volatility	Can be multi-legged, corrective, or even choppy
Entry	Aggressive confirmation or limit order	Trend continuation or FVG-style entry
Risk	Defined by breakout level	Depends on deeper structural zones or FVG invalidation

A retest is tied to the breakout zone—it’s your confirmation that structure has shifted.
A pullback is part of the normal ebb and flow of a trend.

3 Types of Retests Every Trader Should Know

1. Clean Retest

Price returns exactly to the breakout level
Usually forms a wick or small-bodied candle
Great for limit orders or confirmation entries

2. Shallow Retest

Price barely pulls back, usually, creates a gap between the previous structure and current
Often requires lower timeframes for trade opportunities
Usually happens when there’s strong momentum

3. Deep Retest

Price returns beyond the breakout level, often testing internal structure, even reaching below the 50% of the previous range
Still valid if followed by a strong reaction or shift in market structure

Deep retests often trap traders expecting a failed breakout, then resume in the original direction.

Ideal Retest Conditions (Price Action Checklist)

#	Question to Ask
1	Was there a strong, clean breakout candle with follow-through?
2	Is price returning to a well-defined level or zone?
3	Are you seeing wick rejections, rejection candles, or confirmation candle (e.g., pin bars)?
4	Is volume or momentum slowing down on the return?
5	Are you within a high-probability session (London/NY Open)?
6	Can you confirm the reaction with a shift in market structure in the lower timeframe?
7	Do you have a clear invalidation point (e.g., below the retest zone)?

Entry Model: The Retest + Confirmation Combo

You don’t need to guess. Combine two things:

HTF Breakout
LTF Confirmation (after retest)

Example:

Price breaks H4 resistance
Returns to the zone with a small wick
Drop to LTF H1 or M15
Wait for a breakout at LTF

This method avoids chasing and keeps your entry tight and smart.

For targets, check this:

Mastering Risk Management: Stop Loss, Take Profit, and Position Sizing

How to Use Fibonacci to Set Targets & Stops (Complete Guide)

Retest Entry Blueprint

Step	Action
1	Identify key breakout level (previous S/R or range)
2	Watch price return to the zone—mark wick zones or FVGs
3	Wait for confirmation (wick rejection, engulfing, or BoS)
4	Enter on confirmation or place limit with structure stop
5	Target the next clean level or follow a 2R–3R model

Key Takeaways

Retests are confirmation checkpoints, not random pullbacks
Avoid chasing the breakout—let price come to you
Use structure, timing, and reaction to validate the setup
Retests reduce risk and improve reward-to-risk ratios

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This content may have been written by a third party. ACY makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplies by any third-party. This content is information only, and does not constitute financial, investment or other advice on which you can rely.

Author

Jasper has been in the markets since 2019 trading currencies, indices and commodities like Gold. His approach in the market is heavily accompanied by technical analysis and of course, supported by fundamentals. He has a background in trading proprietary firms and has been teaching students how to navigate themselves in the markets from basic to advance concepts.

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Prices are indicative only

Mastering Retests: How to Enter with Confirmation After a Breakout

Goal of This Lesson:

Real-Life Analogy

Why Retests Matter in Price Action

What Is a Retest?

Retest vs. Pullback – What’s the Difference?

3 Types of Retests Every Trader Should Know

1. Clean Retest

2. Shallow Retest

3. Deep Retest

Ideal Retest Conditions (Price Action Checklist)

Entry Model: The Retest + Confirmation Combo

Example:

Retest Entry Blueprint

Key Takeaways

Start Practicing with Confidence — Risk-Free!

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