Breakaway Pattern is a bearish reversal pattern. It consists of 5 candles. In this pattern, the current trend is seen beginning to slow and then filling of the gap is seen. First candle in this formation is a long white candle, which closes near its high. Second candle is a white candle, which gaps up. Third and fourth candles continue in the direction of the current trend and have smaller bodies. Fifth candle is a long black candle, closing inside the gap between first and second candle.
A reversal is confirmed in the form of black candle or a large gap down on sixth day. Strategy: Short positions can be taken once low of the fifth candle is broken.Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
