{"id":2886,"date":"2020-01-21T13:00:27","date_gmt":"2020-01-21T18:00:27","guid":{"rendered":"http:\/\/www.morpheustrading.com\/blog\/?p=2886"},"modified":"2023-01-23T12:01:47","modified_gmt":"2023-01-23T17:01:47","slug":"best-stock-breakouts","status":"publish","type":"post","link":"https:\/\/morpheustrading.com\/blog\/best-stock-breakouts\/","title":{"rendered":"Chart Basing Patterns: How to Find Top Stocks to Buy BEFORE They Break Out"},"content":{"rendered":"\n

Stock breakouts are about more than simply buying stocks that are trading at new highs. In order for a breakout to be valid and without a high risk of failure, a stock must first possess a valid base of consolidation on its chart pattern.<\/strong><\/p>\n\n\n\n

A base<\/a> is crucial to an uptrend, as the stock or ETF builds a strong foundation to launch the next advance. Before a stock can launch a big price run up, it must first have a solid base pattern to build upon.<\/p>\n\n\n\n

It’s sort of like the foundation for a house;<\/strong> if it’s not solid, the levels above can become unstable. For stocks, base patterns serve as that foundation. They occur when a stock’s price falls, then consolidates over a series of weeks or months. This leads to what is known as a “buy setup.”<\/p>\n\n\n\n

Bases typically form after<\/em> a stock\/ETF has already experienced a substantial price increase of at least 30%. That uptrend is important because it shows the stock has already built up a track record of price growth, and has gained support from big institutional investors.<\/p>\n\n\n\n

In this article, we will show you how to spot the two top “basing” chart patterns that precede the best breakout buy setups:<\/p>\n\n\n\n

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  1. Cup With Handle (Deep Correction)<\/strong><\/em><\/li>\n\n\n\n
  2. Flat Base Consolidation (Shallow Correction)<\/strong><\/em><\/li>\n<\/ol>\n\n\n\n

    Study the following chart patterns closely, as they will enable you to develop your eye and eventually read stock charts like a pro.<\/p>\n\n\n\n

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