Glossary

Breakout

Price moving through an important level (resistance, range boundary, pattern) on volume; either the start of a new move or a trap.

In a healthy breakout, volume rises, the candle closes clearly beyond the level and the retest holds the level. A weak breakout (low volume, wick) most often turns out to be false.

Two entry approaches: at the moment of the breakout (momentum, more false breakout risk) or on the retest (better price, risk of missing the move).

Related terms

Where it appears in the guides

Guides whose text uses this term; most frequent first.