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A breakout is a bullish technical analysis term depicting a price move

that exceeds a defined resistance level and proceeds to sustain higher


prices until the next resistance level is formed. The opposite is true for
a Breakdown, ie., when price breaks a defined support level to sustain
lower prices until the next support is formed. Breakouts are usually
accompanied with a surge in volume indicating motivated buying
demand that surpasses existing supply as prices rise. Breakouts indicate
the potential for the price to start trending in the breakout direction.
This example of breakout ill come back to, once im done explaining
types of breakouts.
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Reversal breakout- When after a sharp downtrend, price breakouts
immediately into an uptrend, indicating a V- shaped formation, its
called reversal breakout. The price of the stock doesnot take any kind
of rest before starting a new trend, in this case. So, first identifying a
preceding trend is important.
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Consolidation breakout-

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