Breakout Strategy

A BREAKOUT strategy in trading refers to buying or selling an asset when its price moves outside a defined price range or "trading range." The goal of this strategy is to profit from significant price movements in a short period of time.

Here's how it works:

1. Identify a trading range: This is a period of time in which the price of the asset oscillates within a defined high and low range. The Support is the low(s) and the Resistance is the high of the trading range
   
2. Wait for a breakout: A trader will wait for the price to "break out" of the defined range, either by moving above Resistance or below the Support and closing beyond these levels. This indicates a potential change in market sentiment and a move in a strong direction.
   
3. Once the price breaks out, the trader will enter a trade in the direction of the breakout. For example, if the price breaks out above the high, the trader will buy the asset, and if the price breaks out below the low, the trader will sell the asset. In the above example, the entry was in the the arrow of the breakout candle. 
4. Set a stop loss: A stop loss is a predetermined price level at which the trader will exit the trade if the price moves against them. This helps to limit potential losses in the trade.

It's important to note that breakouts are not always reliable and can lead to false signals. As with any trading strategy, it's important to have a well-defined plan and to use proper risk management techniques.