The Breakout Trading Strategy I Use to Catch Big Moves
I’ve longed resistance and shorted support for 9 years… This is the exact opposite of what every trader tries to do. In this article, I will share my entire strategy so you can skip years of testing and losses. This is something you will want to bookmark, take notes on, and set time aside to think about. Lesson 1: The Only 2 Trading Strategies Before you can identify good momentum setups, you need to understand what momentum trading actually is. Momentum and mean reversion are opposite strategies based on opposite assumptions. The Two Trading Styles Momentum (where you take a trade betting on a continuation of the current trend)Mean Reversion (where you take a trade betting on a reversal of the current trend) One assumes strength continues; the other assumes strength exhausts. Let’s consider this through a visual example. Suppose price is approaching a resistance level (in other words, a level where there was previously selling pressure, preventing the price from moving higher). Momentum assumes the level will break. You’re betting on continuation.Price approaches resistance, you buy, expecting it to push through and keep running.The level becomes support once broken. Mean reversion assumes the level will hold. You’re betting on rejection.Price approaches resistance, you short, expecting it to bounce back down.The level acts as a ceiling. Same chart. Same resistance level. Opposite strategies. There is no right or wrong. The key is to understand when you are in a momentum trade environment, such that momentum strategies are highly aligned. The next section shows you exactly how to identify when the environment favours momentum (my best strategy). Lesson 1 Summary There are 2 trading styles: momentum and mean reversionMean reversion bets levels will hold; momentum bets levels will breakOne is not better than the other; it depends entirely on the trade environment Lesson 2: Optimal Trade Environment Just opening a long every time price hits resistance won't make us any money. Without the right conditions, momentum dies immediately after the breakout. You enter. It reverses. You're stopped out. That's not bad luck, that's a bad trading environment. The Rowing Analogy Imagine you’re rowing a boat. You either row against or with the current. One makes it easier to row while the other takes a lot more effort. Your boat, or rowing technique, didn’t change… Only your environment did. Trading is the same. Your strategy is your boat. Your optimal trade environment is the current. Now use this 3-filter checklist to ensure you only take trades where a breakout is likely (with the current). Filter 1: How Did Price Approach the Level? What you WANT: A slow, grinding staircase pattern approaching resistance.Each candle makes incremental progress.Higher lows are stacking up.Controlled, deliberate movement. What you DON’T want: A fast vertical spike into resistance.Price shoots up in one or two large candles.After a spike, buyers' strength is depleted and price typically consolidates or reverses.This is exhaustion, not momentum. The staircase pattern shows sustained buying pressure building gradually. When this breaks through resistance, buyers are still engaged and ready to push further. Common mistake: Traders see a strong candle break resistance and assume momentum is strong. But these fast moves often reverse quickly. → Do this instead: Take momentum trades when price approaches resistance in a slow, grinding staircase over multiple candles. Real Trade Example: Slow clear grind into resistance showing an optimal ‘price approach to level’ for momentum. Filter 1: slow grindy staircase ✅ Filter 2: What Did Volume Look Like? Volume confirms whether the price movement has conviction behind it. What you WANT: Gradual increase in volume as price approaches resistanceThis pattern shows controlled, sustainable momentum. What you DON’T want: Flat volume (no conviction) or sudden volume spikes (exhaustion).Flat volume means the move lacks participation.Volume spikes often mark climax points where momentum exhausts.Decreasing volume (why would price break out of resistance now, if volume was lower than before?) Volume should mirror the price pattern, steady and building, not erratic. This strategy works because momentum continuation is most likely when participation is sustained, supply is absorbed gradually, and structure remains intact. Real Trade Example: Around the time the grindy staircase begins to emerge, we see a slow, consistent increase in volume. Filter 1: slow grindy staircase ✅Filter 2: clearly increasing volume ✅ Lastly, Filter 3: Moving Average Crossovers This filter distinguishes trending markets (good for momentum) from choppy, indecisive markets (bad for momentum). What you WANT to see: Moving averages with minimal crossovers. This indicates a directional trend. What you DON’T want to see: Frequent crossovers. This signals chop and indecision. Fewer crossovers = cleaner trend or range = better momentum continuation. Use the 30SMMA (Smoothed Moving Average). ✍️Quick Actionable Step: To add the 30SMMA on your charts: Search for the Smoothed Moving Average Indicator in TradingViewAdd it to your chartGo into settings and change the "Length" to "30" Real Trade Example: Filter 1 (Price Action): slow grindy staircase ✅ Filter 2 (Volume): clearly increasing volume ✅ Filter 3 (Crossovers): minimal MA crossovers ✅ 🎓Lesson 2 Summary Slow grinding staircase approaches have better follow-through than fast spikesVolume should be gradual (increasing or decreasing), not flat or spikingFewer MA crossovers indicate cleaner directional conditions for momentum Lesson 3: Identifying Setups Now you know what momentum is. You also know the optimal conditions for it. Next, you need to know where to execute these trades. Step 1: Draw Support and Resistance Levels Momentum trades happen at these key levels. You need to identify them consistently. I've already written an in-depth masterclass on how to set these levels. I'll link it at the end of this article. Common mistake: Traders draw levels randomly or inconsistently, leading to missed setups or false signals. Do this instead: Use my step-by-step approach at the end of this article. Step 2: Await Your Entry Trigger on the 1-Minute Chart Once you’ve identified a resistance level on your primary timeframe, switch to the 1-minute chart for precise entry timing. Why 1-minute chart? You learn faster. More trades, more chart exposure and more oppurtunities to practice psychology. I’ve added a bonus guide on why you should be trading the 1-minute chart at the end of this article. Real Trade Example: Step 3: Three Filters Before entering, check the three filters from Section 2: Is price approaching resistance in a slow staircase pattern?Is volume gradually increasing or decreasing (not flat or spiking)?Are there minimal MA crossovers (not choppy)? If any filter fails, reduce your risk on the trade. Only take full risk on A-grade setups, not forcing trades in poor conditions. 🎓Lesson 3 Summary Draw levels using the ZCT masterclass approach at the end of this articleUse your entry trigger on the 1-minute timeframe: 2 candle closes above for confirmationCheck all three filters before entering, allocate risk and size accordingly Lesson 4: Strategy Logic: Stop Loss, and Take Profit You've drawn your levels. You've confirmed the setup aligns with optimal momentum conditions. Now you need precise execution. Entry timing, stop placement, and profit targets determine whether you capture the momentum move or get stopped out on a good setup. This is where most traders lose, not in analysis, but in execution. Step 4: Entry Trigger We have established to wait for two consecutive 1-minute candles to close fully above the resistance level. This confirms the level broke and momentum is continuing. Critical execution detail: After the second candle closes above resistance, place a limit order AT the resistance level (now acting as support), not above it. Price often pulls back slightly after breaking out. Your limit order gets filled on the pullback without chasing. Common mistake: Traders wait for confirmation, then market-buy above resistance as price runs away. They enter late with a wider stop and worse risk/reward. → Do this instead: Preset your limit order AT resistance after the second candle closes. Let price come back to you. Real Trade Example: Step 5: Stop Loss A swing low is: the lowest wick in a pullback. Your stop loss goes at the most recent swing low before the breakout. Common mistake: Traders place stops at the nearest swing low, even if it’s only 0.3% away, leading to frequent stop-outs from normal volatility Do this instead: Always measure the distance of your stop loss using the ruler tool on TradingView. If it’s less than 1%, use the next swing low down. Step 6: Take Profit 1R (Equal Distance to Stop) Your take profit target is 1R, the same distance as your stop loss, but in the profit direction If your stop loss is 1.982% away from entry, your target is also 1.982% away, but on the upside. This gives you a 1:1 risk/reward ratio. Why 1R? It’s conservative and achievable. Momentum trades often hit 1R quickly because the breakout has follow-through. You’re not trying to catch the entire move, you’re taking a high-probability piece of it. Over time, as you get data in your journal, you can start extending your profit targets when you see how far your average winning trades go beyond 1R. This way, you’re not guessing where to take profits, but following a systematic approach. Real Trade Example: 🎓Lesson 4 summary Enter after two 1-minute candle closes above resistance, using a limit order at prior resistance (now support) to avoid chasing price.Place stop losses at the most recent valid swing low, ensuring enough distance to avoid normal volatility and minor stop hunts.Set initial profit targets at 1R to capture high-probability momentum continuation in a repeatable, systematic way. Immediate Next Steps✍️: Read the Support and Resistance Masterclass to learn how to draw levels (shared at end of article)Look at 3 charts using the 3 filter checklist to identify a momentum trade environmentUse the strategy steps to enter your tradeGather 30 trades using this method, journalled and reviewed against the criteria 🎓 Final Summary Lesson 1: Momentum vs Mean Reversion Momentum trades bet that price will continue through a level, while mean reversion trades bet that a level will hold and reject price.Both strategies are valid, but performance depends entirely on matching the strategy to the correct trade environment. Understanding this distinction prevents applying breakout logic in conditions where it has no edge. Lesson 2: Optimal Trade Environment High-quality breakouts form when price approaches resistance in a slow, grinding staircase rather than fast vertical spikes.Volume should build gradually to confirm sustained participation, not remain flat or spike from exhaustion.Minimal moving average crossovers indicate cleaner directional conditions where momentum continuation is more likely. Lesson 3: Identifying Setups Momentum trades should be executed at consistently drawn support and resistance levels.Entries are triggered on the 1-minute chart using two consecutive candle closes above resistance for confirmation.All three environment filters must align before taking full risk; weaker conditions require reduced sizing or passing the trade. Lesson 4: Stop Loss and Take Profit Enter using a limit order at prior resistance (now support) after two confirmed 1-minute candle closes to avoid chasing price.Stop losses should be placed at the most recent valid swing low with enough distance to avoid normal volatility and minor stop hunts.Initial profit targets are set at 1R to capture high-probability momentum continuation in a repeatable way. 🎓What Changes From Here The next time price approaches resistance, you won’t have to guess if it will break out. You’ll know when a breakout has real momentum, when volume confirms it, and when conditions support follow-through. You’ll also execute with defined entries, stops, and targets. #CryptoZeno #tradingStrategy
Tokens from OPEN's monthly unlock just reached KuCoin. Here's the path they took. $OPEN
Today, a wallet deposited $1.23M of OPEN into KuCoin. That's about 4% of mcap.
The tokens didn't come from nowhere. They trace back to a wallet that has released exactly 9.4M OPEN every month for 11 months. That matches the community share of OPEN's monthly unlock to the token.
Each month those tokens go to a small group of addresses that take turns receiving them. Two months ago, three of those holders sent their tokens to a single new wallet.
That wallet sat on them for two months. Today it sent them to KuCoin.
Unlock, holding wallets, one wallet, exchange. Every step is onchain.
An exchange deposit isn't a sale, but it puts tokens where they can be sold. The next unlock is on October 8.
Since the thread, 0xC02e pulled another 2.72M and 1.98M BR out of Gate, about $4.96M. That's roughly 40% of BR's daily spot volume.
This single wallet has now taken 15.46M BR off Gate in two days, about 5% of circulating supply.
None of the other wallets we track have moved, and nothing has gone back to an exchange.
Derivatives positioning is still split. By accounts, about two thirds are short, L/S 0.50. By position size it's the opposite, 1.64 with more weight on the long side. Funding is flat. Neither side tells you where price goes on its own, it just shows the book is divided.
Across all the wallets we track, withdrawals are now around 49.7M BR, roughly 16% of circulating supply.
Q's rally is happening almost entirely in futures $Q
Price is up 44% in 24 hours. Futures volume hit $565M. Spot volume was only $12.65M. That's futures trading at 44.7 times spot.
Open interest rose 132% in the same period. Funding climbed to 0.15%, around 15 times the usual level, so longs are paying a steep premium to stay in.
Positioning is split. By accounts, about 62% are short, L/S 0.60. By position size, it's 1.39 with the weight on the long side. $3.79M got liquidated in 24 hours.
On chain, a wallet that pulled 24M Q from Gate a month ago deposited all of it into KuCoin shortly before the move. That's about 0.5% of circulating supply, and KuCoin moved most of it to cold storage.
When a move is carried by leverage rather than spot buying, it tends to get sharper in both directions.
MASSIVE WHALE ACCUMULATION DETECTED Smart money is quietly loading up on $ENA Whale 0xd0A4 just went on a massive shopping spree withdrawing a staggering 18.34M $ENA $5.13M across multiple top tier exchanges today!
When a whale drains liquidity from 4 different CEXs in a single day they arent planning to sell tomorrow.
$BTC At the moment price is hovering in the region between the 0.618 and 0.5 fib levels on the 4h.
Historically, most retracements fall to the 0.5 fib level before we see a reversal. If price action stays above this range, we could see a bounce from here to retest the OB at $86k.
However, if we see a continuation lower and we close on the 4h below the 0.5 level, my target area of $80k has a higher probability of playing out.
$BTC Here's why I believe price will not create another low,
A lot of people are targeting the massive cluster of liquidity that's stacked around the 60s,
But if you compare our current bear market's bottom structure to the last bear market's bottom structure,
You will find out that we formed a very similar bottoming structure and we had stacked un-swept lows there as well meaning stacked liquidity there too,
But once again price never went back to sweep those levels and just continued higher after a major flush.
Overall the conclusion is that, if you guys are wishing for new lows just because you are sidelined then you are not getting it,
So instead of waiting for a level that's not coming just wait for the next major pullback and add there cuz we still have the entire run left.
You might feel like the bull market is "so back", or if you were a bear expecting 50k, feel like you were wrong right now.
And no one really wants to see sub 75k occur because then it would be "over" again.
Well, that's frankly how the markets work: to drop it to a level you feel like you want to buy right now, but once it comes, no you don't want to anymore... - psychology 101.
Liquidity and sentiment are quite clearly aligned perfectly with that.
Almost no liquidity above and most liquidity below, concentrated around 75k.
Gentle disclaimer, that this liquidity data is not the most accurate but coin glass does the best job along with some other ones. And I'm just showing the charts below per illustration.
I also want to highlight that I am a bull on the macro timeframe, I called the bottom at 60k with an unmatched 10k SL precision.
But on the daily timeframes, I expect a deep pullback.
Not an easy call, but trading is not "easy" like that, that's the psychological paradox that eternally rewards the trader.
So I continue to call for a local downside move.
I'll give up if I get stopped out of my 86k shorts.
And as always, I can be wrong. But I'd rather be wrong on my own thesis than joining the echo.
$BTC So far, price is holding above the 50-week MA...
If you look at historical price action, once we've closed on the weekly above the 50-week MA, it's a good indicator that sentiment has shifted bullish.
I've seen a lot of traders looking for a $75k retest, which would situate price back below the line.
If everyone is looking for the same situation to play out, MMs will likely manipulate against it.
$BTC Every ATH has been shallower than the previous one, and the best sell zone has consistently formed between two different .618 Fibonacci extensions.
The previous bull market topped between the 2.618 and 1.618 extensions, but much closer to the 1.618.
This cycle could follow a similar path.
Why?
The main difference between this cycle and previous ones is that the bear market bottom was ~20–30% shallower.
That means significantly less upside is required to reach the 1.618 extension.
If price continues to follow the same pattern, the 1.618 should sit much closer to the eventual macro top.
This also aligns with the diminishing-returns theory across each cycle, adding another confluence to the $160K region.
H investors who chose the long route are now locked until 2029 $H
In April, the Humanity Foundation gave investors two options. Give up 70% of their allocation and exit in one go in June, or extend vesting to a schedule starting in September and spread over 12 quarters.
Today the second option showed up onchain. A distribution wallet locked 14.86M H into 48 separate Sablier streams. 4 wallets, 12 quarterly tranches each.
The first tranche opens today, about 1.24M H across the 4 wallets. The remaining 11 unlock every three months until June 2029.
The wallet that set up the lock still holds 2.73B H. About $178M, 27% of total supply. That's equal to 70% of the current circulating supply.
In the previous post we shared a single wallet that withdrew 4.82M BR from Gate. It isn't alone. Over the same period, several other wallets and a multisig have been pulling BR from Gate too.
The wallets followed the same path. Small chunks first, then transfers in the millions. Three of them repeat chunks of exactly 180K BR.
The multisig received 5.65M BR in the last hour.
The addresses we found so far withdrew 24.35M BR in total. About $23.8M, 7.4% of circulating supply and more than BR's daily trading volume.
$BTC is currently compressing within this tight LTF range.
Now we either see some more consolidation today, which would then likely carry on over the weekend,
or price breaks out and we see another decisive move in one of the two directions.
The longer BTC continues to consolidate, the more decisive the eventual breakout is likely to be. So if that’s the case, we could see another sharp move going into next week.
A break above the highs would likely send us back toward the local high around $87K and increase the chances of further upside.
A breakdown, on the other hand, would push price lower to revisit the previous HTF high or potentially even extend into the $80k–$82k region.
A breakdown is the scenario I’m currently more interested in, as this would trigger my first long scenario.
If BTC breaks higher instead, I’ll simply remain flat and wait for the next decent opportunity to present itself.