Understanding the Use of False Breakout of Trendline in Daily Time Frame as Warning for Price reversal.


False breakout for bullish movement can be defined as the process of price action breaking an established Trendline when the requirements for bullish movement have not been met. The requirements for bullish movement are;
1. 10, 40 and 200 SMA must cross over the Trendline
2. 10 SMA will be the last to cross the Trendline
3. 10 SMA crossing the Trendline before 40 SMA will produce false breakout when price reached stochastic overbought or price closing outside Bollinger band with bearish candle stick
False breakout could be explained as price action break of Trendline and later closes below the Trendline. This scenario can help us determine the end of trend.click here to continue Understanding the Use of False Breakout of Trendline in Daily Time Frame as Warning for Price reversal

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