Fakeouts, Stops & Targets

Why some breakouts fail, how to spot the warning signs, and how stops and targets keep failed breakouts small and winners meaningful.

Not every breakout works

A fakeout (or false breakout) happens when price pops above the pivot, attracts buyers, then falls back into the base or below it. Fakeouts are a normal part of breakout trading. Even experienced traders see many breakouts fail; what separates them is that their losses on the failures stay small.

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