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Halt resumptions & breakout risk

Why halts create both the best and the worst entries.

9 min · Intermediate

What you'll learn

• Explain why halt resumptions can gap far from the halt price
• Apply rules for entering, or skipping, trades around halts
• Adjust position size for the risk of another halt

Key takeaways

• Resumption prices can be far from halt prices, so treat the resumption itself as unpredictable.
• Never open a new position in the seconds before a likely halt.
• Trade the structure that forms after resumption, using limit orders and a defined stop.
• Cut size in stocks that have already halted, and pass on setups that fail the 2R test.

Glossary

• Limit up / limit down halt — A pause triggered when price reaches an LULD band and cannot trade back inside it.
• Resumption auction — The process that sets the reopening price after a halt, matching the orders queued during the pause.
• Resumption range — The high and low of the first candle or two after a halt; used as the first structure to plan around.

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