Breakout - We know support and resistance lines are the result of investors expectations.

Even trend lines have the same source of expectation, but these expectations can change over time, and the price can exceed over expectation levels.

Such changes are called breakouts.

After a breakout the resistance line will become the new support line.

The old resistance line will usually prevent prices falling under the new support level.

The reason is, every time the price falls to the old resistance level, buyers invest in the security and support the price.

As in the support and resistance example, trend lines may be penetrated also.

After a breakout it's usual for the price to recoil to the breakout point. This means investors aren't sure about the security.
At this point two things can happen, the price continues in the same direction as the breakout, or it may go back to the previous level.

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