Breakouts
Pro Level Setup!
Kristjan Kullamägi is the best trader I know, who mastered the setup at Pro Level and shares a lot of information about the Breakout setup on his blog (https://qullamaggie.com/) and YouTube channel (@Qullamaggie).
To better understand the setup, I did a Deep dive on six years of historical data (January 2017- December 2022) using TC2000, to a total of 2578 stocks. My main goal was to identify the setup, review its pattern and measure its key parameters to get an edge in the trading strategy.
Here are more details on the studied universe and the number of identified breakouts.
For the complete list of Breakouts, some key parameters were measured in order to create the statistical picture of how the setup is behaving. In the video below you will find the results and main insights of the first deep dive.
The Breakouts form a distinctive pattern, highlighted by Kristjan Kullamägi in one of his videos. I tried to identify those patterns during the deep dive and classify the full list of 963 breakouts accordingly. Here is the % per pattern:
Following the deep dive, I was curious to see in what market environment most of the Breakouts happened. As a result, I mapped them all on the SPY chart to see what the data would suggest. The findings are presented in the video below:
At the next step, I looked at the intraday price action and volume. The study showed relevant structural elements which are critical to understand and trade the setup. Results are presented in the video below:
I then tried to understand how many stocks had a setup but did not breakout and tried to look for technical analysis clues on why a breakout did not happen. In this way, I expected to find data that would suggest when to trade and when to not trade the Breakout setup. Findings are presented in the video below:
Biotech was isolated from the initial deep dive as it has a reputation to be very speculative and catalyst driven. A deep dive was made to this industry as well, to have a full picture of the opportunities that the breakout setup has on the market. The results and insights are presented in the video below:
| Thank you and best of luck!