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Lesson 05 of 17 Break of Structure
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ICT CONCEPTS
05 17

ICT / SMC Concepts · Lesson 05

Break of Structure

Learn how swing highs and lows reveal whether market structure is continuing.

  • Intermediate
  • Interactive charts
  • Lesson 05 of 17
•

Before We Start

So far you have marked zones: gaps, Order Blocks and Breakers. Now we zoom out. This lesson is about the shape of price: its swings.

By the end you will be able to label HH, HL, LH and LL, and point to where a Break of Structure happened. Two rules to keep in mind:

  • Bullish BOS: a higher low, then a break above the prior high.
  • Bearish BOS: a lower high, then a break below the prior low.
01

Before BOS: Understand Market Structure

Price does not move in a straight line. It forms swings: highs, lows, pullbacks and expansions. Market structure is the pattern those swings make.

Learn four labels. Each one compares a swing with the swing before it.

HH

Higher High

A swing high above the previous swing high.

HL

Higher Low

A swing low above the previous swing low.

LH

Lower High

A swing high below the previous swing high.

LL

Lower Low

A swing low below the previous swing low.

Label the Swings

Reveal the swing lows, then the swing highs, then the pattern they make.

Educational example

Constructed teaching data, not real market data. Higher highs plus higher lows: bullish structure.
02

Bullish Structure

Bullish

A bullish structure generally builds like this: higher high, higher low, higher high, higher low. Each swing steps up from the one before it.

Higher High · HH > previous HH
PREVIOUS HIGH102.40
NEW HIGH104.10
HIGHER HIGH✓
Higher Low · HL > previous low
PREVIOUS LOW99.80
NEW PULLBACK LOW101.20
HIGHER LOW✓
03

Bullish Break of Structure

Bullish BOS

In this framework a bullish BOS needs a bullish sequence: a higher low, then a higher high. Work through it in order:

  1. Find an existing bullish structure.
  2. Identify the most recent meaningful high.
  3. Watch the pullback.
  4. Check that the pullback forms a higher low.
  5. Price then moves above the prior high. That break is classified as a bullish BOS.

Traders use BOS as a continuation signal. In this framework it is interpreted as evidence that the existing structure is continuing. It does not promise that price will keep rising.

Bullish BOS
  1. PREVIOUS HIGH
  2. PULLBACK
  3. HIGHER LOW
  4. BREAK ABOVE PREVIOUS HIGH
  5. BULLISH BOS

A Bullish BOS, Step by Step

Swing high, higher low, then the break. Watch which level is broken.

Educational example

The break is measured against a prior structural high, not an arbitrary candle.
04

Bearish Structure

Bearish

Mirror it. A bearish structure builds: lower low, lower high, lower low, lower high. Each swing steps down.

Lower Low · LL < previous LL
PREVIOUS LOW101.60
NEW LOW99.90
LOWER LOW✓
Lower High · LH < previous high
PREVIOUS HIGH104.20
NEW BOUNCE HIGH102.80
LOWER HIGH✓
05

Bearish Break of Structure

Bearish BOS
  1. A bearish structure exists.
  2. Price forms a low.
  3. It retraces.
  4. The retracement forms a lower high.
  5. Price breaks beneath the prior structural low.
  6. A new lower low forms.

Same logic, mirrored. Look one swing back, find the previous low, and see whether price takes it out after a lower high.

Bearish BOS
  1. PREVIOUS LOW
  2. PULLBACK
  3. LOWER HIGH
  4. BREAK BELOW PREVIOUS LOW
  5. BEARISH BOS

A Bearish BOS, Step by Step

Swing low, lower high, then the break below.

Educational example

Mirrored constructed example. Red accents mark the bearish labels.
06

Not Every High or Low Break Is BOS

Markets are full of small candles and minor highs and lows. A BOS should relate to meaningful swing structure. Do not label every tiny break.

Valid BOS
Swing
A clear structural swing
Pullback
A visible pullback with a higher low
Break
A close beyond that swing
Noisy break
Swing
A tiny local candle high
Pullback
No clear structural sequence
Break
Just a poke above minor noise

Try it. Three highs are marked below. Only one is the meaningful structural swing high.

Knowledge check

Which break matters?

Which level should be used for the bullish BOS?

07

The Pullback Confirms the Structure

For a bullish BOS it is not enough for price to print a higher high. The structure also includes the higher low. For a bearish BOS, the lower high is part of the sequence.

BullishHL + HH
BearishLH + LL

A Poke vs a Full Structure

Same prior high, two very different stories. Toggle between them.

Educational example

Constructed example. Structure is about the sequence, not one crossed line.
08

Continuation vs Reversal

BOS
Purpose here
Continuation of current structure
Example
Bullish trend, then bullish BOS: structure continues
CHoCH
Purpose here
Potential change in structure
Example
Bullish trend, then a key low breaks: a possible bearish shift
BOS: trend continues HHHL HHHL HHBOS

HH, HL, HH, HL, HH. The structure keeps going.

CHoCH: potential change HHHL HH HL BREAKS

HH, HL, HH, then the higher low breaks. Potential change.

09

Connecting BOS With Order Blocks

Remember Lesson 03. An impulsive move away from an Order Block can also break market structure.

The Order Block describes the origin zone. The BOS describes what happened to the structure. They are different concepts.

One move, two labels
  1. ORDER BLOCK
  2. DISPLACEMENT
  3. PRIOR SWING BREAKS
  4. BOS

Order Block, Then BOS

Show the Order Block, then the structure, then the break.

Educational example

The Order Block is where the move started. The BOS is the structural level it broke.
10

Connecting BOS With Fair Value Gaps

Strong displacement that breaks structure can also leave a Fair Value Gap, as you saw in Lesson 01.

Two ideas, one move. Keep them apart.

What each one marks
  1. DISPLACEMENT
  2. FVG (imbalance)
  3. +
  4. BOS (structure)

FVG and BOS in One Move

Show the gap, show the break, then show both.

Educational example

FVG = imbalance inside the move. BOS = structural level broken by the move.

Putting the Concepts Together

Now combine three lessons in one chart: an Order Block, displacement, a Fair Value Gap and a Break of Structure.

OB, Displacement, FVG, BOS

Four steps, one move.

Educational example

Constructed example. Concepts from Lessons 01, 03 and this lesson working together, not a strategy.
12

Why Traders Care About Structural Breaks

Price-action traders interpret a new higher high after a higher low as evidence that buyers remain capable of pushing price beyond the prior swing.

For the bearish case, a lower low after a lower high is interpreted as continued selling pressure.

The source describes this in terms of continuing order flow and liquidity around swings. That is part of the framework. Treat it as an interpretation, not proof of who is buying or selling.

13

BOS vs Market Structure Break

BOS

Continuation of the current structure.

MSB / CHoCH-style break

A potential reversal or structural change.

We'll focus on Change of Character in the next lesson.

14

ICT vs SMC Terminology

The source treats BOS mainly as an SMC concept, and notes that ICT has related structural ideas. Trading communities often use overlapping terms.

?

Knowledge Check

Knowledge check

Check 1

What just formed?

Knowledge check

Check 2

What structure is this?

Knowledge check

Check 3

Price breaks a small local high, but the larger swing high is still intact. Is this necessarily a bullish BOS?

Knowledge check

Check 4: Complete the structure

In a bullish structure, what should normally appear between the two higher highs?

Knowledge check

Check 5: BOS or reversal?

After HL, HH, HL, HH, price makes another higher high. Continuation or reversal?

★

Your Turn

Find the Bullish Break of Structure

A clear bullish market with a swing high, a pullback and a rally. Three highs are lettered.

Educational example

Which level must price break for the bullish BOS?

Pick a letter. Then the previous high, the higher low, the BOS and the new higher high appear.

Now the other direction.

Find the Bearish BOS

A clear bearish market. Reveal it one step at a time.

Educational example
Lower high, previous low, break, lower low.

Bullish BOS: five steps

  1. Step 1: Find an uptrend.
  2. Step 2: Identify the previous swing high.
  3. Step 3: Wait for a higher low.
  4. Step 4: Watch price break the swing high.
  5. Step 5: Mark the new higher high.

Bearish BOS: five steps

  1. Step 1: Find a downtrend.
  2. Step 2: Identify the previous swing low.
  3. Step 3: Wait for a lower high.
  4. Step 4: Watch price break the swing low.
  5. Step 5: Mark the new lower low.
!

Common Mistakes

Marking every candle high or low

Correction: Focus on meaningful market swings.

Ignoring the pullback structure

Correction: A bullish BOS includes a higher low. A bearish BOS includes a lower high.

Calling every break a reversal

Correction: BOS is generally a continuation concept.

Confusing BOS with CHoCH

Correction: BOS continues structure. CHoCH suggests the structure may be changing.

Using BOS as an automatic entry

Correction: BOS provides context, not certainty.

15

Where Can BOS Be Used?

The source emphasises intraday charts. It mentions 30, 15 and 5 minute charts as common ICT/SMC-style examples. That is convention, not proof that they are the best.

1m 5mcommon 15mcommon 30mcommon 1H 4H

Common intraday examples. Market structure exists on multiple timeframes. The swing definition simply changes with scale. A BOS on 5m may sit inside a completely different 1H structure.

5m

Small swings

Short pullbacks and quick breaks.

1H

Larger swings

Fewer, more visible turning points.

4H

Broader structure

The bigger backdrop for smaller charts.

16

BOS Gives Context, Not a Guaranteed Trade

Order BlockFVG LiquidityPremium / Discount Risk management
✓

What You Learned

  • Market structure is built from swing highs and lows.
  • Bullish structure forms higher highs and higher lows.
  • Bearish structure forms lower highs and lower lows.
  • Bullish BOS: a higher low, then a break above the prior structural high.
  • Bearish BOS: a lower high, then a break below the prior structural low.
  • BOS is generally interpreted as continuation.
  • Not every tiny high or low break is meaningful.
  • BOS can combine with Order Blocks and FVGs.
  • BOS is context, not a guaranteed entry.
Key rule

BOS = STRUCTURE CONTINUATION, not simply price crossing a random line.

Bullish BOSHL
+ BREAK PREVIOUS HIGH
= NEW HH
Bearish BOSLH
+ BREAK PREVIOUS LOW
= NEW LL

The whole lesson in one picture

Bullish structure
  1. HH
  2. HL
  3. Break above prior high
  4. Bullish BOS
  5. New HH
Bearish structure
  1. LL
  2. LH
  3. Break below prior low
  4. Bearish BOS
  5. New LL

All lessons

01Fair Value Gaps 02Inversion Fair Value Gaps 03Order Blocks 04Breaker Blocks 05 · You are hereBreak of Structure 06Change of Character 07Change of Character Plus 08Equal Highs 09Equal Lows 10Liquidity 11Liquidity Grabs 12Premium & Discount Zones 13Propulsion Blocks 14Liquidity Sweeps 15Change in State of Delivery 16Balanced Price Range 17Breakaway Gap

Further reading

Educational content only — not investment advice. Market-structure labels are an interpretation of price, not a proven market law, and a chart cannot show who is buying or selling. All charts use constructed, illustrative data.