Breakout Trader

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Breakout Trader

A trader that makes investment decisions based on technical indicators in order to make a large return. The breakout trader may use a variety of indicators, but often relies on support and resistance levels. When a security rises above its resistance level, the breakout trader buys it because it is highly likely that the security will continue to rise. Thus, the trader relies on "break out" prices to amass an abnormal return.