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What is a Bullish Breakout? and How does it occur?

A free video tutorial from Corey Halliday
professional trader and educational instructor
Rating: 4.4 out of 5Instructor rating
9 courses
38,038 students
What is a Bullish Breakout? and How does it occur?

Lecture description

In this lecture we will introduce you to Bullish Breakout.

Learn more from the full course

Start Trading Stocks Using Technical Analysis! Part 2

Learn the secrets of professional trading from a former stock broker, and make profits investing today!

02:02:50 of on-demand video • Updated May 2017

Trade stocks like the pros!
Avoid the common mistakes that new traders tend to make.
Calculate support & resistance to measure risk vs. reward.
Learn the phychology behind investor decisions.
Identify the 4 stages of a trend.
Buy & sell stock with confidence!
English [Auto]
Then today, bullish trading strategies, we're going to start with breakouts and the basic concept behind a breakout is that there's some resistance holding the stock back, something that is keeping the stock depressed. Right. So there's a lot of different types or styles of resistance. It could be that the stock has hit this level before and had trouble. It's sold off from that area. So it's a clearly defined resistance. Sellers acted here in the past. We expect them to act the same way in the future. It could be that it was only one time that we turned down, but it was a significant turn. This was the area that the trend failed, that previously, for example, a trend stalling or changing pivot resistance. It could be a psychological price point. You know, the first time a stock gets to one hundred or first time that gold got to a thousand, first time that the Dow got to ten thousand. There are psychological numbers that stand out that loom large in the market that can act as resistance could be moving averages. Twenty fifty two hundred are the most widely watched and followed on Wall Street. But again, technical resistance, something that we might struggle with, but if we can break through, could be very significant. Turn now as we look at a bullish breakout. The actual breakout occurs once you've cleared that resistance. It's like if you look above you, you have the ceiling. If you break through it, you've now broken through. You have clear skies ahead. Right. You have an opportunity to move higher and buyers feel more confident that they can aggressively come in because we just took out a key technical level and it gives buyers confidence. It gives short sellers that are betting against the stock confidence that, hey, we were in the well, pardon me, short sellers, a lack of confidence that, hey, we're in the wrong trade, we are in a losing position as that stock breaks higher in price. So if we just push through resistance, where can we go? Their imaginations can run wild on that one. And frankly, the possibilities are endless. The stock could really significantly go to the upside. So you get a short squeeze scenario where short sellers are forced to cover their shorts, further perpetuating the upside by buying the market and pushing stock prices higher.