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Break of Structure & Change of Character

Break of structure (BOS) and change of character (CHOCH) are how 'smart money' market-structure traders read trend continuation and reversal. This article explains a BOS as a swing break in the direction of the trend (continuation), a CHOCH as the first swing break against the trend (potential reversal), the overlapping terminology (MSB), internal versus external structure, and how to read the framework honestly — as a lens, not a guarantee.

13 min readPublished 26 June 2026

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Swing Highs & Swing LowsTrendlines

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Key terms

ATRBollinger BandsBreakoutCandlestickDivergenceDojiFibonacci RetracementGap

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Liquidity & Liquidity Sweeps

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Reversals

A reversal is a genuine change in a market's prevailing direction — an uptrend becoming a downtrend, or vice versa. This article defines a trend structurally (higher highs and higher lows, or lower highs and lower lows), shows how a reversal is the breaking of that sequence, and tackles the hardest problem in all of price action: telling a real reversal from an ordinary pullback. It closes on why reversals are only ever confirmed in hindsight, and why 'catching' them is where so many go wrong.

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