Pivopen

SMA Break & Retest Trading Pattern

In our reversal trading, we use the 20 SMA; moving averages are a commonly used tool overall. That’s why you can often see the squeeze pattern around moving averages as well and a break and retest pattern at moving averages is a well-known pattern.

The price behavior follows the same patterns: after a market has topped (or bottomed), many traders will enter a trade once the moving average has been broken. Once price has pulled away just a little bit, traders move their stops to break-even and are then taken out on the retest.

Add comment

Follow us

Don't be shy, get in touch. We love meeting interesting people and making new friends.

Most popular

Most discussed