#BreakoutTradingStrategy Definition of Breakout Strategy

A breakout occurs when the price moves beyond a certain trading range. A breakout signals that the forces of supply and demand are shifting in favor of either buyers or sellers. This imbalance pushes the price in a new direction as market participants react to the changes.

Breakout strategies aim to capitalize on the beginning of a new trend. Traders use technical analysis to identify trading ranges and expected breakouts.