What it looks like
A swing low is a candle with higher lows on both sides of it, a local trough. In a downtrend the market makes lower swing lows and lower swing highs. A BOS down is the candle that closes (not just wicks) below the most recent swing low while that pattern is in place.
What it means
The trend is doing what a trend does: each push goes further than the last. Sellers are still in control and nothing has changed, and that is the point. It is a signal to stay with the fall, not to hunt for a bottom.
How to trade it
- 1
Confirm the market is already making lower lows and lower highs, and that a candle has closed below the last swing low.
- 2
Do not chase the break. Wait for a pullback towards the level that just broke and sell there.
- 3
Put the stop above the last swing high.
- 4
Target one to two times the stop distance, or the next floor below.
- 5
Example: on the gold 15 minute chart price closes below the last swing low, then bounces back to it. The last swing high is 9 points above your entry, so the stop is about 10 points away and the target 10 to 20 points.
A close back above the last swing high.
Where it works best
In clean, falling markets on 15 minute charts and higher, especially when the higher timeframe is also falling.
WickSpeak finds the bearish break of structure automatically on any chart and names it on the candles that made it. It writes what it is, how to trade it and what proves it wrong right on the chart. Playbook can use it, or any of the 146 patterns, as a condition alongside up to 12 conditions on any of 12 timeframes, and backtest the play on past candles with your costs.
Common mistakes
- Selling the breakdown candle at its low instead of waiting for a pullback.
- Treating a wick below the swing low as a break without a close.
- Selling straight into a major floor such as the previous week's low.
Related patterns
Questions traders ask
What does a bearish BOS mean?
It means a downtrend has made another lower low with a close below the last swing low. The fall is carrying on as normal.
How do you enter after a break of structure down?
Wait for price to pull back towards the level that just broke and sell there. Put the stop above the last swing high.
Does a wick below the swing low count?
No. WickSpeak needs a candle to close below the swing low. A wick that closes back above can instead be a liquidity sweep.
What proves a bearish BOS wrong?
A close back above the last swing high. That breaks the lower highs the downtrend relied on.