After a round number breaks, the stops behind it feed the move

[Shadow Trader]

Price pushes through a level that many traders were watching. For a moment, nothing happens. Then it accelerates.

The acceleration comes from orders waiting just beyond the level. Stop losses from traders who were on the wrong side, entry orders from breakout traders, and algorithms that trigger on a break. Each triggered order adds to the move, which triggers more.

The result is a short burst of one-way movement, often five to fifteen pips on a major, that ends when the resting orders have been used up. Then price frequently retraces a good part of it.

For a scalper, the burst is the tempting part and the retrace is the dangerous one. Entering late in the burst means paying a wide spread at the moment of peak momentum. The retrace then hits the stop.

Some approaches work better. Entering on the break itself, with strict size limits, accepts the spread but catches the start. Waiting for the retrace and trading the second push avoids the chaos at the cost of missing the first move.

The trouble with both is that not every break cascades. Many fail, and price slips back through the level. Telling the two apart in advance isn't possible, though volume and the speed of the first push give hints.

Logging every round-number break for a few weeks, with the size of the move after and the retrace, gives a realistic idea of which approach pays on a given pair.

Which approach has worked better around breaks, the early entry or waiting for the retrace?