A breakout occurs when an asset’s price crosses a recognized support or resistance level. Support suggests a price is unlikely to fall below a level; resistance marks a high price that is difficult to exceed. These levels help traders interpret volatile assets, although long-term investors may largely ignore them. section 10.1.2
A resistance breakout
If analysts identify resistance near $100,000 and the price crosses it, traders may interpret the move as a breakout and worry about missing further gains. Others may expect sellers to push the price back down. A Bitcoin support example places the level near $72,000 when its price is $78,940. section 10.1.2
Treat a breakout as an interpretation rather than a guarantee. Chart patterns are templates, and analysts have repeatedly misjudged movements because prices do not always follow them. section 10.1.2
