Home » Breakdown

Breakdown

« Back to Glossary Index

A breakdown is a breakout to the downside. A breakdown happens when there is a breakout downward through support. The buyers who used to be at this level are gone, but there is still selling pressure.

Price trades sideways for a while but it is unable to garner the strength to move higher. When this happens, it signals buyer weakness.

breakdown

The price that breaks downwards through a support level is expected to continue to fall. This is considered a sell signal. Especially if the volume is also increasing.

If the price has fallen significantly since the break, a better price can be achieved by waiting for a reaction back.

Please note that price in an uptrend often triggers false sell signals on breakdowns through support.

Related
Parabolic

Parabolic describes a market that moves a great distance in a very short period of time, frequently moving in an accelerating Read more

Bitcoin Block

Blocks are data structures within the blockchain database, where transaction data in a cryptocurrency blockchain are permanently recorded. A block records Read more

Monetary Policy

Monetary policy refers to the actions taken by a nation’s central bank to influence the availability and cost of money and credit to Read more

XM Bonus