#BreakoutTradingStrategy

The breakout trading strategy is based on buying an asset when its price exceeds a certain resistance level or selling when the price drops below a support level. These levels are usually clearly visible on the chart and are formed as a result of price accumulation over a certain period. Traders expect that after the breakout, the price will continue to move in the same direction and use this to make a profit.

Key concepts:

Resistance level:

The price above which the asset price cannot rise for a certain period.

Support level:

The price below which the asset price cannot fall for a certain period.

Breakout:

The price overcoming the resistance or support level.

Trading volume:

The number of shares or contracts sold or purchased over a specific period. Breakouts are often accompanied by an increase in trading volume, which can serve as confirmation of the authenticity of the breakout.

Volatility:

The degree of price fluctuation of the asset. High volatility may indicate the possibility of a breakout.