What is Breakout

What to look for! Breakouts

We have now established what are trend lines and how to draw them. When one of theses lines is breached is called a Breakout.
If a breakout occurs on a Resistance line many Trader's will class this as BUY signal and act accordingly.
If a breakout occurs on a Support line many Traders will class it as a SELL signal an act

Please note how the OLD Support line NOW becomes the NEW Resistance line.

Note Rising Volumes on Breakout

From time to time there will be FALSE signals given.

This is why it is important to WAIT FOR CONFIRMATION of a trend reversal or breakout.

It is at this point we need to add other indicators to help with our Analysis.

From :http://forex-winning.blogspot.com


  1. Blogger says

    eToro is the #1 forex broker for rookie and advanced traders.