ROKU developed a strong uptrend before the flat top breakout which is a key characteristic we look for leading into the flat top chart pattern. Flat warts are smaller than other warts and, unlike other warts, smooth on top. Unfortunately, fund managers generally cannot buy stocks under $5 because of their poor historical performance. Address: Tradetobefree.com, LLCPO Box 4882Cary, NC 27519, https://tradetobefree.com/wp-content/uploads/2017/09/logo_00.png, https://tradetobefree.com/wp-content/uploads/2019/10/flattoproku.gif, Tradetobefree.com, LLC - Copyright All Rights Reserved © 2019, ROKU Stock Forecast & Predicting Earnings Surprises, Latest ITBF Upgrades and Trading Q3 Earnings, our favorites we have developed and tested extensively over the past few years, How to Swing Trade Earnings – The Earnings Flag (2020 Update), Swing Trading a Market Uptrend & Riding a TSLA Rocketship. What is a Flat Top? This pattern utilizes 2 or more continuation or consolidation patterns to complete itself. It has the same structure as the bull flag but inverted. In this pattern, there’s no pullback and no downward slope during the consolidation period. I would wait for price to retest instead of going next-bar-market. Sometimes, the pattern begins to form an ascending triangle where it makes higher lows and finds resistance at around the same price point. Generally, you want a longer consolidation except for the most extreme uptrends such as this high tight flag pattern. Instead, the consolidation has a flat top. If you draw trend lines around it, it looks like a rectangle. The bear flag is an upside down version of the bull flat. Some day traders also use a flat top breakout on the intraday chart to trade the quick momentum that can happen after price reaches a high on the day. If not, don’t expect to do well early on as with other trading strategies you are starting to learn. Hence, we have developed a resistance line. Here is the breakout in the above example. Again on a 5 minute chart (each candle on the chart represents the low price, high price, open and closing price of the next five minutes of trading). Trend followers and momentum traders like to stay on the right side of the trend and this type of a breakout on a daily chart is a signal for the direction of the next move. Profit targets can be set at round numbers, an overbought reading, or a trailing stop can be used to maximize profits. Those are my favorite breakout patterns. The flagpole forms on an almost vertical panic price drop as bulls get blindsided from the sellers, then a bounce that has parallel upper and lower trendlines, which form the flag. Some day traders also use a flat top breakout on the intraday chart to trade the quick momentum that can happen after price reaches a high on the day. Instead, the consolidation has a flat top. Once trades take place above that flat upper resistance level it is considered a breakout above that level. Flat top breakout trading is used by many momentum traders and trend followers to enter a long position on a market that has broken above resistance on a long-term chart. After breaking out of the flat top early this year, ROKU soared over 300% higher within several months. Once trades take place above that flat upper resistance level it is considered a breakout above that level. When all holders have a profit at the highs there tends to be less selling pressure and price can begin to move higher. So as a flat top breakout consolidates within a few cents of the highs, a bull flag pattern experiences typically 2-3 red candles of pullback and can even pullback to the faster moving averages like the 8 or 10 EMA. Nvidia's flat base completed with a breakout in September of 2016 and was a total of five weeks long. Because this pattern is working very well ahead of Q3 earnings season, we expect some big home run trades on top growth stocks in the weeks ahead. Price looks like its pushing through a Flat Top Breakout on the 60 min. The Flat Top Breakout Pattern. I need to see price close above 1.1093 before getting long. Its very similar to the flat base pattern but is normally discussed in the context of day trading. So normally the entry point is slightly above the high in the flat top pattern. The ascending triangle or flat top breakout is a bullish formation that usually forms during an uptrend as a continuation pattern. Weaker flag patterns – not so much. The flat top breakout chart pattern gets its name from the top of the chart being flat as sellers and buyers have met and agreed at the key resistance level. The flat top breakout pattern signal is more valid and has the potential for a bigger trend to emerge the longer the consolidation and time frames. Typically, it will form after a breakout from a deeper correction (such as a cup and handle). So instead of a 5 minute candlestick chart, a 1 year daily candlestick chart. We prefer the ones that are just rectangular shaped or that begin to make higher lows late in the consolidation near the flat top breakout. The sideways consolidation tends to be more bullish than a bull flag … The flat top breakout chart pattern gets its name from the top of the chart being flat as sellers and buyers have met and agreed at the key resistance level. Unlike other business ventures, simulators now offer you the opportunity to test and develop your trading strategy and skills without risking a dime. Usually, the fundamental and technical conditions are not good enough for us and nowhere near as good as they were for ROKU on multiple breakouts this year. In order to qualify as a continuation pattern, an established trend must first exist. The buy signal is on the breakout. If a stock can make an extreme price move and hold those levels in a narrow consolidation long enough, the chances are better that it will make a strong secondary move if it breaks out with a lot of volume. A flat top breakout can look similar to a flat base pattern but the difference is the flat top happens at the highs of resistance while a flat base can happen inside a long-term trading range and not press new highs. 6 Breakout. Bull Flag: Bull flags are usually very small and can last for only one day or several weeks. A flat top breakout can look similar to a flat base pattern but the difference is the flat top happens at the highs of resistance while a flat base can happen inside a long-term trading range and not press new highs. The range in this pattern can be rectangular shaped or have irregular support levels and both formations are valid as long as the top of the pattern at resistance is flat. If you have done the extensive back-testing and research to know which ones have a high likelihood of success, its a very exciting strategy. An Example of a Good Flat Top Breakout on Earnings and One We Avoid, Top Opportunities We are Eyeing for Our Own Accounts. If you draw trend lines around it, it looks like a rectangle. The flat top pattern is first a long and narrow trading range pattern like the $GLD chart above. Breakout trading is used by active investors to take a position within a trend's early stages. A Flat Top occurs when there is a clear resistance level (flat top) and a slope of higher lows, indicating the upward trend: As you can see in the chart above, the pattern looks like a triangle with the top of the triangle being the horizontal resistance and the bottom … The first thing I want to do is show you a flat top pattern on a shorter time-frame so you know what it is and the typical entry/exit strategies. If you want to save yourself months or years of work in developing your own strategy, you can check out our favorites we have developed and tested extensively over the past few years. The stock trades sideways as the flag forms. ... and descending triangles a flat lower trendline. The set-up: Gold, as represented by the SPDR Gold Shares (GLD), has had solid resistance for months now, just a straight line that you can easily see on the charts, and Monday it had a flat-top breakout, finally breaking through the ceiling after a long-term consolidation period. There are many ways to trade a breakout and a good one to trade during a bull market is the Flat Top Breakout. 09:51:24 (From TradersWire) Daily Setup Alert. Here is a flat top breakout pattern on ROKU which occurred early this year. This pattern also met the requirements for our bull flag pattern or high tight flag. This is an awesome bull flag setup. Once trades take place above that flat upper resistance level it is considered a breakout above that level. This is a chart snapshot from the Thinkorswim trading platform. A flat top breakout intraday near the entry point of a flat top pattern on a longer-term daily chart is ideal. The flat top breakout pattern is similar to the bull flag pattern except the pullback typically has, as the name implies, a flat top where there is a strong level of resistance. A flat top breakout is a bull flag that consolidates sideways instead of pulling back. A Triple Top Breakout that forms as a base after a decline would be deemed a reversal pattern, while a Triple Top Breakout that forms as a consolidation after an advance would be viewed as a continuation pattern. The way to … Instead, the consolidation has a flat top. The breakout is confirmed on a close below support for a rising wedge and above resistance for a falling wedge; The entry comes on a retest of the broken level and can sometimes occur immediately without a rounded retest; A typical stop loss strategy is to place the stop loss beyond the last swing high or low of the pattern A breakout is the movement of the price of an asset through an identified level of support or resistance. Some day traders also use a flat top breakout on the intraday chart to trade the quick momentum that can happen after price reaches a high on the day. A breakout to new all time highs in price can have a lot of momentum and begin a new trend. You can play this setup like a bull flag. While this thing comes with a rather blocky, unappealing design, it nonetheless can be an impactful car with its mobility and speed.
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