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winterwhite Jul 19, 2007 12:39pm | Post# 1

A break below - A Break Above Question
When an analyst speaks of a break below or a break above a certain number, does the "break" refer to the price just "moving through" that number and possibly moving back from the direction it came, or does it refer to the day's "close" being above or below that number?


Vensik Jul 20, 2007 12:24am | Post# 2

An excellent question. In fact the word "break" is one of those words in the forex that can mean any number of things to different people. Depending on the methodology, a break can be any spike through a number (as a spike through the number means Atleast the tic chart has had a close above it). It can also mean a push through a number and close of the candle on the other side, like a bridge across the number. Some even prefer to see a complete open and close on the other side of the number, or a whole candle to form away from the number, before considering it broken.

The key would be to ask the mentor of whatever methodology you are studying for their description of a "break".

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