I just realized that many new traders do not fully understand a very effective basic technique called Break and Retest. Honestly, this is a strategy that helps me avoid quite a few mistakes in trading.

First, what is retest? Simply put, it is when the price breaks through an important resistance or support level, then comes back to test that level again. And that is the best opportunity to enter a trade.

Here's how it works: When the price surpasses a major resistance level with high trading volume, it indicates that the trend is about to change. But instead of entering immediately (which many people do), I usually wait for the price to pull back near that broken level. At this point, the old level becomes a new support.

Why is retest important? Because it allows me to set a tighter stop loss, and the risk/reward ratio becomes much more favorable. Instead of entering when the price just breaks out (when everyone is FOMO), I wait for the retest to get a better entry point.

On the other hand, if the retest occurs and the price does not return below the old level, it is a very strong confirmation signal. The market sentiment has clearly shifted — the old level has truly become support. This helps me feel more confident in my trades.

In practice, when using this strategy, I can manage risk better. I can place the stop loss just slightly below the broken level (if buying) or above that level (if selling), because if the price breaks through again, that breakout is false. As for taking profit, I usually rely on technical indicators or expected price targets.

Overall, Break and Retest helps me trade with higher probability and more consistent results. Instead of trying to catch the exact top or bottom, I just wait for confirmation from the market. This applies in most market conditions, whether bullish or bearish.