Breakout Trading Strategy

How to Trade Breakouts Effectively?
How to Avoid Big losses in Failures ?
What to Look before entering into Breakouts?

A THREAD🔖
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What is Breakout ?
A breakout is a stock price moving outside a defined support or resistance level with increased volume.
Always trade breakouts in uptrend for high win ratios
Source : Google
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What to Look before entering a breakout ?
Look for Volume Spikes on Up days and Down Volume on down days.
Simply Volume Should Dry during Pullbacks
This is a sign of Accumulation by Bigger Sharks.
As they buy in huge quantities they have to buy in parts to avoid price spikes
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They dont only buy on Uptrend but continue holding during pullbacks for bigger gains .
Important thing is pullbacks should always have less volumes .
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Rules For entering a Breakout .
1. Never enter more than 50 % of quantity on Breakout Region .
2. Most of the time the stock Pulls back to Breakout Region Giving a Good Reward opportunity.
3. Use Alerts to buy exactly at Pivot Points / breakout Regions to avoid extended stocks
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4. Keeping Alerts is important and once can use @tradingview or @zerodhaonline or other Platforms to keep alerts .
5. Stock That is extended more th 4% above BO region shouldnt be bought as they dont provide Good RR .
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Entry Rules :
1. Enter 50% Qty on Breakout os stock
If Stoploss Hits Your Loss is only on 50%
2. Wait for Retest and add the next 30%
3. Add Further Qty on way up
4. Always add on Winners Rather than Loosers
5. Protecting Capital Is utmost imporant in this case
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Retests Also Fail and no one can Avoid this scenarios and Loss has to be booked Definatley
Example : Radico
Look for Volume Breakouts with Price Breakouts the probability of Winning Increases
Stocks Breaking out in Uptrend have High winning Chances then in DownTrend
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Range Breakouts VS Trendline Breakouts
Range Breakouts have Higher Winning % Compared to Traingle , Pennant Trend Breakouts due to over head Resistance .
As Buyers Are Trapped at Higher Prices they will Try to exit at every bounce at Min loss or Breakevens
Example :JindalSaw
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Stoploss Rules :
Follow Maximum Stop of 8 to 10% in trades as Losses Work Against You .
If you are not getting Small Stop Trade move on to next trades as opportunities are endless .
Breakout Failures are common and hence Risk has to be managed
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Target Rules :
Target Should Be arounf 15 to 20% when your risk is 8 to 10 %
You can reduce this risk by entering at correct buy points and keeping stops at 5% .
Risk Reward of 1:2 is Great with 50% win Ratio
Book Partially at 1st targets and Keep Stop at cost.
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More from JayneshKasliwal

The Ultimate Guide to moving averages !
A mega thread to understand the Use of 21 , 50 and 200 ema.
4 Effective uses of Exponential Moving Averages !

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#stockmarkets #nifty
@kuttrapali26 @caniravkaria

Once Can refer the use of Moving Averages Throught this thread


4 Popular uses of moving averages

1. Identifying the direction of trend
2. MA crossover
3. Dynamic Support and Resistance
4. Price Crossing above Key EMAs

Note : In chart 21 ema is red , 50 ema is green and 200 ema is black

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Why EMA and not SMA ?
EMA is fast , accurate and prices in recent data !
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Use 1 : Identifying the trend of stock on dtf

The 21 ema will tell us the Short term trend of a stock , while the 200 ema will tell us the long term trend of a stocks

Any EMA that is sloping
:upwards trend is BULLISH
:sideways trend is NEUTRAL
:downwards trend is BEARISH
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𝟱 𝗧𝗿𝗮𝗱𝗶𝗻𝗴𝘃𝗶𝗲𝘄 𝗜𝗻𝗱𝗶𝗰𝗮𝘁𝗼𝗿𝘀 𝗮𝗹𝗹 𝗧𝗿𝗮𝗱𝗲𝗿𝘀 𝘀𝗵𝗼𝘂𝗹𝗱 𝗸𝗻𝗼𝘄 𝗮𝗯𝗼𝘂𝘁:
𝗣𝗮𝗿𝘁 𝟮

🧵 Thread 🧵
Retweet And I will Link a 36 Page PDF

𝟭. 𝗔𝗱𝗱 𝗙𝘂𝗻𝗱𝗮𝗺𝗲𝗻𝘁𝗮𝗹𝘀 𝗼𝗻 𝗰𝗵𝗮𝗿𝘁
🔸 Link:
https://t.co/HcIXT7V002
🔸 Click on the above link -> Add to Favourites -> Add on Chart from favourites and start using it !
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You can add financials from many fundamental criteria's like
🔸 Cashflows
🔸 Income Statements
🔸 Balance sheets
🔸 PE,PB ratios
🔸 Marketcapitlization
🔸 Statistics
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How to change Settings:
🔸 There are 8 columns you can basically select any financial you want
🔸 You can select quarterly or Yearly values and can also write
🔸 The names of the financiaLS Example : EPS Qtr3
🔸 You can Change colours , font size 
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𝟮. 𝗜𝗻𝗱𝗶𝗰𝗮𝘁𝗼𝗿 𝗥𝗮𝘁𝗶𝗻𝗴𝘀
You cannot track each and every indicator like ( 𝗠𝗼𝘃𝗶𝗻𝗴 𝗔𝘃𝗴𝘀 , 𝗥𝗦𝗜 , 𝗠𝗔𝗖𝗗 ) etc , you can use plot this custom strategy to understand whether the trend is positive or negative of those indicators
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