Breaker Block

The rules

1. The candle: the last up candle before the drop (a bearish order block).
2. Sweep first: the drop must take a prior low, the sell-side liquidity.
3. The break: a fast move up closes above the high that formed before the drop.
4. The flip: the bearish block has failed. It is now a bullish breaker.
5. No sweep? Same shape, but it is a mitigation block, not a breaker.
6. Why it holds: sellers trapped in the block exit at breakeven when price returns.

How to mark it

1. Find a low that was swept, then a close above the high before it.
2. Step back to the last up candle before the drop: that is the breaker.
3. Mark its high and low and extend them to the right.
4. Wait for price to return to the breaker; do not chase the break.
5. Enter at the breaker's top, stop below its low.

The 1:3 trade

Entry at the breaker's top on the first return. Stop below the breaker's low. Target the old high on the left. Reward is exactly three times the risk.

Before you enter

• A prior low was swept before the move up
• Price closed above the high before the drop
• The breaker is the last up candle before that drop
• Price returned to the breaker for the first time
• Stop below the breaker, target the next high

Common mistakes

• Calling it a breaker when no low was swept
• Marking a random up candle instead of the last one before the drop
• Buying the break instead of waiting for the return
• Trading a breaker that price has already returned to
• Placing the stop inside the breaker

Key terms

• Breaker block: failed order block that flips role after a sweep and a break
• Order block: last opposite candle before a strong move
• Sell-side liquidity: sell stops resting below a prior low
• Sweep: a wick through a level that closes back inside
• MSS: a close beyond the swing that shifts structure
• Mitigation block: same shape without the sweep; lower quality

Sweep, break, return. No sweep, no breaker.