Breakout Trader

Dictionary Says

Definition of 'Breakout Trader'

A type of trader who uses technical analysis to find potential trading opportunities, identifying situations where the price of an asset is likely to experience a substantial movement over a short period of time. Breakout traders generally look for key levels of support and resistance and will place transactions when the asset's price passes through these levels. Long positions are taken when the price of an asset breaks through a level of resistance, and short positions are taken when the price breaks below a level of support.

Breakout Trader
Investopedia Says

Investopedia explains 'Breakout Trader'

Many breakout traders find trading opportunities by identifying chart patterns such as channels, ascending triangles, descending triangles, head and shoulders, etc. These types of traders will generally set up target prices to be equal to the distance between support and resistance levels.

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Related Definitions

  1. Breakout

    A price movement ...
  2. Support (Support Level)

    The price level ...
  3. Resistance (Resistance Level)

    A chart point or ...
  4. Triangle

    A technical ...
  5. Head And Shoulders Pattern

    A technical ...
  6. Technical Analysis

    A method of ...
  7. Long (or Long Position)

    1. The buying of ...
  8. Pattern

    In technical ...
  9. Chartist

    An individual ...
  10. Symmetrical Triangle

    A chart pattern ...

Articles Of Interest

  1. Spotting Breakouts As Easy As ACD

    Wondering what it means to be a "logical trader"? Take a look at this system devised by Mark Fisher.
  2. The Anatomy Of Trading Breakouts

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  3. Capitalize On False Breakouts In The Danger Zone

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  4. Backspreads: Good News For Breakout Traders

    This bullish trading strategy offers unlimited potential profit with limited risk.
  5. Using Options Instead Of Equity

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  6. How To Break Bad Trading Habits

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  7. Trading Multiple Time Frames In FX

    This is often the first - and most costly - level of analysis to be overlooked.
  8. Continuation Patterns: In-Depth Look At Triangles

    We take a closer look at ascending and descending triangles to help traders predict the ultimate breakout direction.
  9. Tips For Controlling Investment Losses

    A profit/loss plan helps investors recognize mistakes and invest logically, rather than emotionally.
  10. Triple Screen Trading System - Part 4

    How can a trader use the Elder-Ray oscillator as the second screen of this system? Find out here.

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