The first break of structure against the prevailing trend — the earliest reversal signal.
A Change of Character (CHoCH) is the first Break of Structure that runs counter to the current trend. In an uptrend, it's the first close below a prior higher low. In a downtrend, it's the first close above a prior lower high. A CHoCH doesn't guarantee reversal — but it's the market's first admission that the previous order flow may be done. In RRR terms, it's a powerful Reveal.
The CHoCH is the earliest objective signal that the trend you're trading might be over. Traders who ignore it hold losers into reversals. Traders who respect it flip bias early and trade the new direction.
Uptrend all morning. Price closes below the 5,838 higher low at 7:15 AM. CHoCH. You stop looking for longs and start watching for short setups on the retrace.
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