Lessons › Chart patterns › When patterns fail
World 3 · Chart patterns · lesson 16 · level 4
When patterns fail
When a pattern breaks and then snaps back, the traders who trusted it get trapped, and price can run hard the other way.
What it is
Price broke above resistance, then fell straight back below it. A trap.
Your task in the app
Is this breakout real? Then decide: buy, sell, or wait?
How often it worked
| Market | Times found | Target first | Stop first | Went nowhere |
|---|---|---|---|---|
| India (NSE) | 12 | 33% | 67% | 0% |
| United States | 12 | 33% | 67% | 0% |
| Japan | 4 | 100% | 0% | 0% |
| Crypto | 118 | 39% | 50% | 11% |
| Forex | 10 | 30% | 50% | 20% |
| Commodities | 3 | 0% | 100% | 0% |
Counted on real past charts by the Trading Class research engine, 159 cases in all. Past odds, not a forecast.
Read more on the False breakout pattern page.
Goal of this lesson: Recognize failed and busted patterns and see why a failure can be a signal of its own.