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BREAKOUTS
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A
Breakout Is A Chart Pattern That Is Commonly
Looked For By Commodity Futures Traders
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When a commodity has been
trading sideways for a while and then breaks above or
below one of the trend-lines, it is considered a breakout
and the start of a new trend.
A breakout is a good pattern but
doesn't always hold, since it may just be a covering
rally.
The longer the sideways trend
persists, the better. Also, if a breakout occurs on
higher volume and the old resistance line now holds as
support, or the opposite on a breakout to the downside,
then the breakout becomes more valid.
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