Breakaway Gaps: How To Buy Strength While Managing Your Risk

• Breakaway gaps are caused by a flood of institutional demand, leading to a stock gapping up significantly at market open.
• To find a new entry point, pull up a 5-minute (or 15-minute) chart, wait for the first 5 minutes of trading, and use the high of the first 5-minute bar as your new buy point.
• Implement strict risk management: avoid chasing if the stock moves more than 5% above the new buy point, and cut losses if the stock falls below your entry.
• Ensure the overall market is trending higher, ideally in a power trend, as most stocks follow the general market direction.

This video explains how to identify and trade breakaway gaps, which occur when strong institutional demand causes a stock to gap up at market open. It provides a strategy for finding new entry points after such gaps, emphasizing risk management and the importance of a supportive overall market trend to capitalize on these opportunities.