Retesting as a key strategy in trading: understanding the mechanics and practical application

ser_ngmi · 2025-12-16T04:01:09+00:00

Retest is the phenomenon where price returns to a previously broken level, serving as a verification of the barrier's strength. It indicates significant supply or demand, becoming key points for price movement. Understanding retests aids traders in finding optimal entry points, allowing for better risk-reward ratios and enhancing overall trading results.

ser_ngmi

2025-12-16 04:01:09

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Retest is a phenomenon that occurs when the price returns to a level that was previously broken. It is not just a technical pullback, but rather a re-examination of the strength of that barrier. When the price moves in one direction and then changes trajectory, it signals the presence of significant supply or demand in that zone. Such areas become permanent points of attraction and repulsion for price movement.

Mechanics and Universality of the Phenomenon

A characteristic feature of the retest is its universality. Regardless of the observation period—five-minute charts, hourly data, or daily candles—the mechanism remains unchanged. Each critical level acts like a magnet, attracting price action. No trading pattern or chart figure is complete without this phenomenon. Retests appear across all market scales and influence decision-making for both beginners and experienced traders.

Practical Advantages for Entry

Understanding the principles of retest gives traders a significant advantage when searching for the optimal entry point. Instead of rushing to open a position immediately on a breakout, patient market participants wait for a retest of that level. Such a tactic requires discipline and the ability to control impulsive decisions. Waiting for a retest usually offers more favorable entry conditions with a better risk-reward ratio. While the strategy of immediate entry on a breakout also has its merits, the skills of waiting greatly improve overall trading results.

Recognizing and properly utilizing retests is fundamental to developing a professional approach to trading in financial markets.

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