Glossary · Structure

Break of Structure (BOS)

A break of structure (BOS) is when a candle closes beyond the most recent swing high in an uptrend, or below the most recent swing low in a downtrend. It confirms the existing trend is continuing. A BOS is a continuation signal, not a reversal, and traders use it as evidence the trend is still intact.

Diagram of a bullish break of structure: an uptrend of higher highs and higher lows, a dashed line at the last swing high, and a candle whose body closes above that line. — A bullish BOS: after a higher low, a candle body closes above the last swing high. The higher low before it becomes the level the trend now has to hold.

Close or wick? The conventions differ

There is no official definition of a break of structure, and the pages that rank for it disagree. You will meet three versions:

Candle close. A candle on the timeframe you are reading has to close beyond the swing point.
Any wick. Price trading beyond the swing point for a moment is enough.
Close with a strong candle. Some traders also want a large, fast candle (often called displacement) so the break isn't a slow drift through the level.

StraviFX uses the close. A wick beyond the level that closes back inside is read as a possible liquidity sweep instead: the stops resting above the high were triggered, but price didn't stay there. Whichever rule you pick, use the same one every time, or your structure labels will change with your mood.

A worked example

EUR/USD on the 1-hour chart is in an uptrend. The last swing high is 1.0850 and the pullback after it bottomed at 1.0815, a higher low. These prices are an illustration, not a trade idea.

BOS: a candle closes at 1.0862, above 1.0850. The uptrend has made a new high, and 1.0815 is now the higher low that has to hold.
Not a BOS: a candle spikes to 1.0858 but closes at 1.0846, back below 1.0850. Under the close rule nothing has broken; the spike may have been a sweep of the stops above the high.

If price later closed below 1.0815 instead, that would not be a BOS. It would be a change of character, the first break against the uptrend.

BOS vs CHoCH

	BOS	CHoCH
Direction	With the trend	Against the trend
Level broken (uptrend)	Last swing high	Last higher low
Level broken (downtrend)	Last swing low	Last lower high
What it says	The trend is continuing	The trend may be ending

Why it matters

A BOS tells you the current direction still has buyers (or sellers) behind it, so plans that trade with the trend stay on. It also moves the line in the sand: after a bullish BOS, the higher low that came before it is the level that would prove the uptrend wrong, which makes it a logical place to think about a stop loss.

Common mistakes

Counting wicks on some days and closes on others. Pick one rule and keep it.
Reading a lower timeframe BOS as a higher timeframe one. A 5-minute BOS inside a 4-hour downtrend is a pullback getting stronger, not a new uptrend.
Chasing the breakout candle. Buying the close of a big candle puts the stop a long way off, so the same risk buys a much smaller position. Check the distance with the risk reward calculator first.
Treating a BOS as a forecast. It describes what price has done. Trends that just broke structure can still reverse on the next candle.

Questions

Is a break of structure bullish or bearish?

It takes the direction of the trend it belongs to. In an uptrend, a close above the last swing high is a bullish BOS; in a downtrend, a close below the last swing low is a bearish BOS. A break against the trend has a different name: a change of character.

Does a wick through the swing high count as a BOS?

Traders disagree. Some count any trade beyond the level; others, including StraviFX, need a candle to close beyond it. A wick that pokes through and closes back inside is treated as a possible liquidity sweep: stops above the high were triggered, but buyers couldn't hold price there.

What is the difference between a BOS and a breakout?

A breakout usually means price leaving a range or crossing any level a trader has drawn. A BOS is narrower: it is a close beyond the latest swing point of an existing trend, so it only exists once a trend of higher highs and higher lows (or lower highs and lower lows) is already in place.

Should I enter as soon as I see a BOS?

A BOS says the trend is intact; it isn't an entry on its own. Entering on the breakout candle often puts the stop far away. Many traders wait for a pullback and plan the stop beyond the new higher low, then size the trade with a lot size calculator. None of this guarantees the trade works.

Break of structure in the app

When StraviFX reads a chart, it names the trend and the swing points behind it, and the BOS or CHoCH where it sees one, in plain English. Tap the term to see its definition. The plan that follows (entry, stop, two targets and the lot size) is analysis, not a signal to trade; the decision stays with you.

Related terms

Market structure: The sequence of swing highs and lows a market prints: rising is bullish, falling is bearish, neither is a range.
Change of Character (CHoCH): The first break against the trend: an uptrend closing below its last higher low, or a downtrend above its last lower high.
Market Structure Shift (MSS): The confirmed flip that can follow a CHoCH: a failed swing in the old direction, then a close beyond the next swing.
Swing high / swing low: A candle whose high is above its neighbours, or whose low is below them. The pivots every structure reading is measured from.
Higher highs / higher lows: The four swing labels (HH, HL, LH, LL) and what each combination says: uptrend, downtrend or range.
Range / consolidation: Price moving between a ceiling and a floor with no new highs or lows beyond them. A reason to wait, or to trade the edges.
Retest: Price coming back to a level it has just closed beyond, to see whether the level now holds from the other side.
Liquidity: Resting orders, mostly stop losses, that pool just beyond obvious highs, lows and round numbers. Price is often drawn toward them.
Liquidity sweep / stop hunt: A push past an obvious high or low that triggers the stops there, then closes back inside. A close beyond is a breakout.
Buy-side / sell-side liquidity: Buy orders resting above price (BSL) and sell orders resting below it (SSL). The pools a move is likely to travel toward.
Equal highs / equal lows: Two or more highs or lows at nearly the same price. A flat edge that collects stops, so a common sweep target.
Order block (OB): The last opposing candle before a strong move away. A zone price may return to, with the stop just beyond it.
Fair Value Gap (FVG): A three-candle gap where candle 1's high and candle 3's low don't overlap. Traded through fast, so often revisited.
Breaker block: A failed order block that price closes through, then returns to from the other side, where it can act the opposite way.
Mitigation block: A failed order block after a swing that fell short. Price breaks it, then returns from the other side as trapped traders exit.
Supply / demand zone: The base a sharp move left from: demand below price, supply above. The first return to a fresh zone usually counts most.
Premium / discount: A range split at its 50% midpoint, equilibrium. Buy in the discount half, sell in the premium half.
Optimal Trade Entry (OTE): The 62–79% pullback of the last impulse leg. A deep entry that keeps the stop close and the target far.
Entry: The price a trade opens at: market, limit or stop. With the stop and target fixed, it sets the risk and the reward.
Stop loss: An order that closes the trade at a set price to cap the loss. It goes where the idea is proven wrong, plus a buffer.

See every term in the trading glossary.

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