False Breakout – The Most Misunderstood Pattern
Part of Art of Chart Reading
Traders often focus on how accurate certain chart patterns are and how much money you can make from using the patterns. The more experienced ones would add to their consideration of the risk reward profile of the patterns they choose to use. However, many traders never plan to react to situations where their patterns failed to produce the expected outcome. It is one of the harder aspect in chart reading that many traders failed to master because it goes against human nature to plan and act on interruption of expected sequence of outcomes that are completely opposite to the original expectations.
False Breakout Definition