🚀 Breakouts: Key to Materialize Gains
Three men came to Dalal Street to trade. The first always knew WHAT was best buy. Second knew WHY it was best buy. But the third knew neither of those things; he only knew WHEN to buy.
He made the most money.🤔
✅ And charts tell us WHEN to buy..
Even when the market is in an Uptrend, it is important to initiate your positions in a stock at the proper time. A breakout from a base pattern (consolidation) is considered an ideal time to buy a stock.
Consider it like boarding a train 🚄 when it starts and leaves its station for a long journey. This breakout point is your boarding station.
There will be resistances in the journey ahead where this train might take stops. These resistances are your destination stations. If you find these stops a little longer or if the train reverses, you can switch the train and can find another one which has just started from the station.
So, do you agree there is no point in sitting in the train as long as it is standing on the station and doesn't move towards its destinations.
If yes, then..
there is no point in entering in a stock also unless it breakouts from a consolidation pattern and shows enough strength for further movement. If you enter before this moment, you might find yourself watching the stock without any desirable movement for many days, weeks or months and thus wasting your precious time.
When a credible breakout is observed, it is the perfect time to put your money in the stock.
A good breakout should have the support of an Uptrend in the overall market. Breakouts in such markets have a higher chance of a strong rally.
Now keeping this in mind, look at these charts and observe how entering at breakout point (and learning WHEN to buy) can improve your returns in the stock market:
If you find this concept of breakout trading interesting, you may also find the concept of compounding of some interest.
You can find it here:
Discover the Magic of Compounding
✅ When your skills in stock market are combined with this concept of compounding, it can turn into a money minting machine.
What do you think? Please email us at 9amprime@gmail.com for any questions or comments.
Disclaimer: Information contained herein is not and should not be construed as an offer, solicitation, or recommendation to buy or sell securities. It is for educational purposes only.
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