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In the core signals of trend trading, "structural breakout" is definitely a key element that cannot be overlooked.
In simple terms, a real structural breakthrough is not just about the price randomly surging to previous highs, but rather about stabilizing at those highs and not breaking through key positions during a pullback. This is when the market confirms a new direction through action. For example, a trend where "highs are consecutively raised and lows also move up simultaneously" is a typical characteristic of a brewing trend; when the price breaks through previous highs, pulls back to hold support, and then rises again, it is a clear signal of trend confirmation.
This can be done as follows:
- When the price breaks through the previous high, don't rush to chase it. Wait for a natural pullback first and observe whether it can hold the key support level.
- If the price pulls back and stabilizes, try to follow up with the previous high as the support level, setting the stop loss below the starting point of this wave structure.
- If the trend continues to rise, adjust the stop loss upwards using the previous low point, and hold the position in line with the trend rhythm.
The significance of a structural breakthrough goes far beyond the simple notion of "the market is going to rise"; more importantly, it indicates that the previous holdings have undergone effective turnover, and a new trend direction has gained market consensus. This is the underlying logic that allows the trend to continue.