Strategy Library·Beginner· 5 min

Breakout strategy

Enter when price decisively leaves a defined range. High win rate when the range is real.

What it is

A 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 OR on a shallow retest. just inside the broken range. = at least 2R.

Common mistake

the first far above the range. The retest is safer and usually pays as well.

Watch it on the chart
Chart breakdown
CONSOLIDATION · coiled rangeBREAKOUT
Marked chart: range, breakout candle, retest zone, stop, and 2R target.
Key takeaways
  • Best breakouts come from tight, obvious ranges.
  • Retest entries beat chase entries.
  • belongs inside the broken level, not at it.
  • No volume = probably a .
Quick check

Price breaks resistance on a strong candle, then pulls back to the level. What's the pro play?

Educational simulation only. Not financial advice. Prop firm rules vary between companies — always read the official rules of the specific firm before trading.