To exit a profitable trade, consider using a profit target. It helps to have exit strategies in place when purchasing, so you can sell when it is the right time based on your criteria.
If the price breaks above triangle resistance (upper trendline), then a long trade is initiated with a stop-loss order placed below a recent swing low, or just below triangle support (lower trendline). If the price breaks below triangle support (lower trendline), then a short trade is initiated with a stop-loss order placed above a recent swing high, or just above triangle resistance (upper trendline).
The objective of the breakout strategy is to capture profit as prices move away from the trendlines forming the triangle. To help isolate when the price is breaking out of the support or resistance levels, observing an increase in volume can help highlight when the price is starting to gain momentum towards a breakout. Since each trader may draw their trendlines slightly differently, the exact entry point may vary between traders.
These breakouts are used as indicators of opportunities for traders. Breakout refers to a market situation where prices move above resistance levels or below support levels.
