A change of character (CHoCH) is the first break of market structure against the prevailing trend: in an uptrend, the first close below the most recent higher low; in a downtrend, the first close above the most recent lower high. It is read as the earliest objective sign that the trend may be turning, before a full reversal is confirmed.
CHoCH is the counter-trend counterpart to a break of structure (BOS), which is a continuation break in the trend’s direction. In smart-money terminology the pair forms the grammar of structure: BOS keeps you with the move, CHoCH warns the move may be ending. Many traders treat CHoCH as synonymous with a market structure shift (MSS), and mechanical versions confirm swings with a fractal lookback and require a close, not just a wick, through the level.
Usage is genuinely inconsistent between communities — some reserve CHoCH strictly for the first counter-trend break and BOS for everything else, others blur the two — and the lookback setting changes which swings count. Definitions vary, so pin down the exact convention a strategy uses before reading or testing its CHoCH rule.