A breakout occurs when the price of an asset moves above a resistance level or below a support level with increased volume. This movement indicates that the market sentiment has shifted, and a new trend may be beginning. Breakouts can signal the start of significant price movements, making them attractive opportunities for traders.

Importance of Breakouts

1. New Trends: Breakouts often mark the beginning of new trends, providing early entry opportunities for traders.
2. Volatility: Breakouts can lead to increased volatility and significant price movements, creating potential for substantial profits.
3. Confirmation: Breakouts can confirm the direction of the market, providing traders with more confidence in their trading decisions.