Break of Structure (BOS)

What a break of structure is

In an uptrend, the market is making higher highs and higher lows. A break of structure to the upside occurs when price moves above the previous swing high, confirming that the series of higher highs continues. In a downtrend, a break to the downside occurs when price moves below the previous swing low. In both cases the break is in the direction of the existing trend.

The idea is that structure is a chain of swing points, and a break shows the chain is still extending. Traders use the event to describe that the trend is intact and that buyers or sellers have kept control.

BOS versus change of character

A related term is change of character, often abbreviated CHoCH. It describes the first break against the prevailing trend: for example, in an uptrend, price closes below the most recent higher low. Where a BOS says the trend continues, a change of character says the trend may be shifting.

Some traders use the terms interchangeably, and others reserve BOS for continuation and CHoCH for reversal, as described here. When reading a commentary, check which convention is used. The labels matter less than the price action they point to.

Close or wick

A key question is whether a break requires a close beyond the swing point or whether a wick is enough. A wick beyond the level with a close back inside is often described as a liquidity sweep rather than a break. A body close beyond it is usually considered a true break. Stricter definitions require a close on the chosen timeframe, sometimes with a second candle for confirmation.

The stricter the definition, the fewer false breaks you will see, and the later the signal arrives. There is a trade-off, and each trader chooses a point on it.

How traders use it

In a trend, a BOS is often read as confirmation that pullbacks are still being bought or sold. Traders may then look for pullback areas to engage with the trend, such as a fair value gap or order block formed during the break. A change of character may prompt traders to stand aside, reduce risk or consider the opposite direction.

None of this is reliable on its own. Structure breaks fail regularly, especially in ranges, on thin overnight sessions and around news. Combining the break with volume, the session calendar and higher timeframe context improves the picture but does not remove uncertainty.

A simple way to practice

Mark swing highs and lows on a chart. Whenever price closes beyond the latest swing in the direction of the trend, label it BOS. Whenever it closes beyond the latest opposing swing, label it a change of character. Then check what happened over the next ten candles. A log of twenty examples in your instrument shows how often breaks continue, stall or reverse, which is more informative than any rule you read.

Worked example

Common mistakes

• Calling a wick beyond a swing a break, when the candle closed back inside.
• Treating every BOS as a trade signal. Many fail, especially in ranges.
• Mixing timeframes: a break on a one-minute chart may be meaningless on the hourly.
• Forgetting that news can cause breaks that reverse within minutes.

How it connects to ES, NQ, SPY and QQQ

Breaks of structure on ES and NQ during the Asia and London sessions often mark the overnight direction before the US open. Translating the break level into SPY or QQQ terms gives options traders a reference for the open.

LiquidityLevels briefings describe the trend sequence and level reactions, which together capture whether the overnight market broke structure and whether it held.

Note: terms like this come from price-action frameworks popular with retail traders. They describe patterns after the fact; they are not validated predictors.

Frequently asked questions