Posts tagged breakout

stock chart breakout

Don’t Make This Mistake If You Are Going to Trade Breakouts

Aug 23rd

Posted by Craig in Swing Trading Tips

14 comments

I follow a lot of blogs and I have discovered that breakout traders tend to make a common mistake. If they would avoid this one mistake, they might be able to consistently make money trading breakouts.

Take a look at the following scenario:

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Failed Breakout on a Stock Chart

3 Reasons Why Trading Breakouts is a Losers Game

Jul 6th

Posted by Craig in Technical Analysis

3 comments

BREAKOUT!

The word “breakout” sounds so exciting doesn’t it? It sure sounded exciting to me when I first started trading. But then I realized that it is much easier (and smarter) to buy pullbacks.

First of all, “What is a breakout?”.

A breakout is defined as a stock price that moves outside of a support or resistance area. You would then buy (or short) the stock once it moves above or below these areas.

But, it is not that easy.

There are three problems with trading breakouts:

1. Failed Breakouts

2. Consolidations

3. Pullbacks

Let’s break these down (no pun intended!) and I think that you will agree with me that trading breakouts is much easier said than done.

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