Breakout

A breakout is when price breaks a zone and goes into one direction.

Usually, we use Volatility to detect potential breakouts.

Types of Breakouts

• Continuation Breakout - 20230309072827
• Reversal Breakout

Spot Breakouts

• Chart Patterns - 20230228091212
• Trend Lines
• Trend Channel
• Triangle Pattern

Force of Breakouts

• Moving Average Convergence Divergence: when the MACD is reducing, a trend reversal may occur
• Relative Strength Index: can be used to spot Trading Divergence

False Breakouts

To avoid false breakouts, we will wait for a confirmation usually. It can be a new high made after the breakout if we want to go long for example.

Taking Advantage of False Breakouts

META

Status:: #wiki/notes/mature
Plantations:: Technical Analysis - 20230221094216
References:: Babypips