Breakout
Price moving decisively above a key resistance level or the top of a range, often on expanding volume.
A breakout occurs when price closes above a well-defined resistance level — a range high, a prior swing high, or a trendline — signalling that buyers have overpowered the supply zone. Volume confirmation is critical: a breakout on light volume is a warning sign, not a signal.
Failed breakouts (fakeouts) are common. Waiting for a close — ideally a daily close — above the level, and then a successful retest of it as support, filters the majority of traps.
Example
META consolidates under $520 for two weeks. On earnings, it gaps through $520 on 3× average daily volume and holds $520 on a subsequent pullback. The retest confirming $520 as support is the lower-risk entry.
Related Terms
Accumulation
A period where informed buyers are quietly building positions without driving price significantly higher — a potential precursor to an uptrend.
AdvancedBreakdown
Price moving decisively below key support, signalling that sellers have overwhelmed buyers at that level.
BeginnerConsolidation
A period of tight, low-volatility price action — typically a pause within a trend before the next directional move.
BeginnerFalse Breakout
A breakout that fails: price pushes past a key level, fails to follow through, then snaps back inside the range — trapping breakout traders.
IntermediateGap
A price jump between one period's close and the next period's open, leaving a void on the chart with no trades executed.
IntermediateRange
A sideways price structure bounded by identifiable support and resistance where neither buyers nor sellers dominate.
BeginnerResistance
A price level where selling pressure has historically halted or reversed an upward move.
BeginnerSupport
A price level where buying pressure has historically halted or reversed a downward move.
BeginnerSwing High
A candle or bar whose high is higher than both the preceding and the following candle's highs — a local price peak.
BeginnerVolume Profile
A histogram of traded volume at each price level over a period, revealing where the market has done the most and least business.
Advanced