2 April 2026
Healthy pullback or early trend break?
Depth, time, and structure checks that separate a usable retracement from a move that has already changed character.
A healthy pullback respects the prior impulse’s geometry. Price retraces a portion of the advance, spends limited time below a key midpoint, and still leaves the last significant swing low intact. An early trend break does the opposite: it spends time, takes depth, and begins printing lower highs while you are still hoping for a bounce.
Use three filters before you label a pullback ‘usable’. First, depth relative to the impulse — many liquid indices settle near a third to a half before continuing. Second, time — a pullback that lasts longer than the impulse that created it deserves suspicion. Third, structure — if a prior swing low that defined the advance is taken out on a closing basis, treat the idea as broken rather than temporarily messy.
Traders in our clinics often skip the time filter. They tolerate a shallow depth but allow the pullback to grind for days, then force a continuation entry into a market that has already shifted to two-way trade. Marking duration on the chart beside depth keeps that habit visible.
When in doubt, wait for a fresh micro-impulse in the original direction before acting. Continuation entries earn their name by arriving after the pullback has finished negotiating, not while it is still writing the story.