Breakout Definition

A breakout occurs when the price of an asset moves beyond a defined support or resistance level with increased volume.

What is a Breakout?

Breakouts are used by traders to identify potential new trends after a period of consolidation.

False breakouts can occur, where price briefly moves beyond a level before reversing back into the prior range.

A stock trading between $48 and $52 for weeks that suddenly rises above $52 on strong volume is exhibiting a breakout.

A balance sheet is a financial statement showing a company's assets, liabilities, and equity at a specific point in time.

A bar chart is a price chart that shows the open, high, low, and close for a security over a set period using vertical bars.

The base currency is the first currency listed in a currency pair, against which the second currency is quoted.