A shift in market direction — an uptrend failing to make a new higher high or a downtrend failing to make a new lower low, serving as the first sign of a potential trend change. In Smart Money Concepts (SMC) methodology, a Change of Character (CHoCH) is a key signal that institutional order flow may be shifting. Traders use it alongside break of structure to time entries and confirm reversals.
Example
“A bearish change of character appeared on the 1-hour chart when price failed to make a new higher high, signaling a potential shift to bearish structure.”