Breakdown
Price moving decisively below key support, signalling that sellers have overwhelmed buyers at that level.
A breakdown is the bearish counterpart to a breakout — price closes below a meaningful support level, reversing the role of that level to resistance. Like breakouts, breakdowns need volume to be credible.
Short sellers often target the distance of the prior range projected below the breakdown level as a measured-move target. False breakdowns (bear traps) occur frequently near obvious round numbers; a reclaim of the broken level is the invalidation signal.
Related Terms
Breakout
Price moving decisively above a key resistance level or the top of a range, often on expanding volume.
BeginnerDowntrend
A market structure defined by lower highs and lower lows, reflecting sustained selling pressure.
BeginnerRange
A sideways price structure bounded by identifiable support and resistance where neither buyers nor sellers dominate.
BeginnerReversal
A sustained change in the direction of the prevailing trend, not just a temporary counter-move.
IntermediateSupport
A price level where buying pressure has historically halted or reversed a downward move.
BeginnerSwing Low
A candle or bar whose low is lower than both the preceding and the following candle's lows — a local price trough.
Beginner