We use cookies that are necessary for this site to work. With your permission we would also use analytics and advertising cookies to understand how the site is used and to measure our advertising. Cookie Policy
A breakout occurs when the price moves decisively above a resistance level or below a support level, often accompanied by increased volume or momentum. Breakouts signal the start of a new trend or the acceleration of an existing one. False breakouts — where the price briefly breaches a level then reverses — are a common risk, so traders often wait for confirmation before entering.
Gold (XAUUSD) has been trading between $3,000 and $3,050 for two weeks. The price suddenly surges above $3,050 with strong momentum. Breakout traders enter long positions, targeting a move to $3,100 based on the range width. Prices in this example are illustrative.
