What it is
A breakout trade enters when price closes convincingly outside a well-defined support or resistance zone, with momentum.
When it works
Trending environments, after a tight consolidation, on rising volume, and away from major opposing levels.
When to skip it
Choppy ranges, right into major resistance, or when volume is anemic. Most 'breakouts' in chop are fakeouts.
Entry & stop
Enter on the close of the breakout candle OR on a shallow retest. Stop just inside the broken range. Target = at least 2R.
Common mistake
Chasing the first breakout candle far above the range. The retest entry is safer and usually pays as well.