A break of structure (BOS) happens when price breaks a swing point in the direction of the trend. In an uptrend, it's a close above the last swing high. In a downtrend, it's a close below the last swing low. Each BOS confirms that the trend is still in control.
What a BOS tells you
- The trend is continuing. Buyers (or sellers) had enough strength to take out the last swing.
- A new swing will form. After a bullish BOS, the low that launched the break becomes the new higher low to watch.
- Pullbacks are opportunities. Structure traders often wait for a BOS, then look to enter on the pullback that follows.
Close or wick?
This is the most important detail in the chapter. A wick through a swing high shows price traded above it briefly. A candle body closing above it shows the market accepted the higher price. Most structure traders only count a BOS on a body close.
The timeframe of the break matters
A BOS on the 1-minute chart and a BOS on the daily chart are very different events. Always say which timeframe you mean: "daily BOS" or "15-minute BOS". A lower-timeframe BOS against the higher-timeframe trend is often just a pullback.
| Trend | BOS is | Confirms |
|---|---|---|
| Uptrend | A body close above the last swing high | Buyers still in control; a new higher low forms |
| Downtrend | A body close below the last swing low | Sellers still in control; a new lower high forms |
Key takeaways
- A break of structure (BOS) is a break of a swing point in the direction of the trend.
- In an uptrend, a BOS is a body close above the last swing high; in a downtrend, below the last swing low.
- A wick through a level without a close beyond it is not a BOS; it is often a liquidity sweep.
- Each BOS confirms the trend; the pullback after it is usually the better entry.