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A rise in a security's price above a resistance level (commonly its previous high price) or a drop below a level of support (commonly the former lowest price.) A breakout is taken to signify a continuing move in the same direction. Can be used by technical analysts as a buy or sell indicator.


1. In technical analysis, a situation in which the price of a security rises above a resistance level. The resistance level is a price above which a security only rarely climbs. This is a highly bullish signal because it indicates the price likely will continue to rise until it finds another resistance level.

2. In technical analysis, a situation in which the price of a security falls below a support level. The support level is a price below which a security only rarely drops. This is a highly bearish signal because it indicates the price likely will continue to fall until it finds another support level.


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The advance of a stock price above a resistance level, or the fall of a stock price below a support level. A breakout, especially one on relatively heavy volume, indicates to technicians that the security is about to make a major price movement in the direction indicated by the breakout. Thus, if a breakout is upward, a major upward price movement can be expected. A breakout on relatively low volume is suspect. See also break through, congestion area.


Stock prices fluctuate constantly, but each stock typically moves within a fairly narrow range. That means the stock's average price changes gradually, if at all. But sometimes a stock's price breaks out of its limits, and jumps or tumbles suddenly.

Usually the breakout is fueled by a particular event. The company may realize a commercial success, such as a drug company discovering a new cure for a major disease. Or a breakout may reflect a financial development, such as a new alliance with a successful partner.

References in periodicals archive ?
By my calculations, Iran's actual breakout time under the deal would be approximately three months " not over a year.
First, he says, breakout time only measures the time needed to produce fissile material for a bomb, not a bomb itself.
We are often asked by conference organisers about our provision for relaxing spaces for breakout areas and we have plenty of them across our well designed campus which are suitable for delegates to mingle and digest the new information they have received.
Breakout sessions with Bebe Moore Campbell, Yolanda Joe, Victoria Christopher Murray and others.
The conference concluded with joint sessions, during which leaders from each breakout group presented their group's key findings.
Each Breakout event is triggered in precisely the same general way.
MonitorIT is available direct from Breakout Software.
A breakout is a leak of molten metal through the lining of the furnace, usually due to a failure in the hearth walls.
The breakout sessions will be repeated five separate times to ensure participants may attend subjects of their choice.
Industry representatives voiced their concern over the quality and reliability of breakout spares used in major end-items rather than original equipment manufacture (OEM) spares.
The program emphasizes small group breakout sessions, in which all participants can interact.
Rowe's Breakout Stocks Faxletter as "a true groundbreaking campaign.