There are 4⃣ type of #BREAKOUTS

1⃣Breakout without any retest
2⃣Breakout with a re-test
3⃣Breakout with a hard re-test
4⃣Failed breakout

Following tweets explain each one of those with examples from recent breakout alerts
1⃣ Breakout without any retest

If you have a stop-loss placed below the chart pattern boundary, this is the easiest to trade. Following the breakout your stop-loss will no be challenged and price target will be met.

#BAES #FTSE #UK
2⃣ Breakout with a re-test

If you have a stop-loss placed below the chart pattern boundary, this type of trade may test your patience but still will not challenge your protective stop-loss. Chart pattern boundary will even offer a new entry opportunity.

$NDAQ $QQQ
3⃣ Breakout with a hard re-test

If you have your stop-loss below the chart pattern boundary and it is a tight stop-loss, you might get stopped out depending on the hard re-test.

A trading tactic to re-enter: immediately after price recovers above pattern boundary

$JD $QQQ
4⃣ Failed breakout

If you have your stop-loss below the chart pattern boundary, price will fail to hold the breakout level and you will get stopped out. These are part of trading breakouts. It is important to always have protective stops (BELOW PATTERN BOUNDARY) in place.

$INCY
There is no perfect stop-loss strategy.
There is no perfect indicator that will warn you of failed breakouts and improve your win rate.

There is "leap of faith" 'courage to pull the trigger" with those breakouts.
There is managing risk via protective stops and position sizing.
You can follow @TechCharts.
Tip: mention @twtextapp on a Twitter thread with the keyword “unroll” to get a link to it.

Latest Threads Unrolled:

By continuing to use the site, you are consenting to the use of cookies as explained in our Cookie Policy to improve your experience.