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False Breakout
Chart PatternsWhen price briefly moves beyond a support or resistance level but quickly reverses back. Often caused by low volume or stop-hunting. Traders use volume confirmation and time filters to avoid false breakouts.
Related Terms
Breakout
When price moves above a resistance level or below a support level with increased volume.
Volume
The number of shares or contracts traded in a security during a given period.
Support
A price level where buying pressure tends to overcome selling pressure, causing the price to stall or bounce upward.
Resistance
A price level where selling pressure tends to overcome buying pressure, causing the price to stall or reverse downward.