What a breakout really is
• Beyond support and resistance, stop orders and reverse limit orders (liquidity) are piled up
• A false breakout is a 'liquidity hunt' in which a big player briefly pushes price to fill those orders and then reverses it
What separates real from fake
• A real breakout keeps drawing buyers after crossing → a close above the level with volume
• A fake leaves only a long wick with no volume and returns immediately on the next candle
Where people slip
• They look only at the fact that 'the line was crossed', and not at whether buying follows (persistence)
• So they chase at the moment of the breakout and become prey for a liquidity hunt
A breakout is not a signal but a question. Confirming 'are there still buyers after crossing' through the candle close and volume comes first in the order of considering an entry.
When you see a breakout, do you enter because 'the line was crossed', or after confirming 'buyers remain even after crossing'?