Here’s a simple breakdown of the Breakout Pattern you're seeing:
1. Resistance (R-1, R-2): These are levels where the price hits a ceiling and struggles to go higher.
2. Support (S-1, S-2, S-3): These are levels where the price finds a floor and bounces back up.
3. Channel Formation: The price is moving between resistance (top line) and support (bottom line), creating a channel.
4. Breakout: Finally, after hitting support and resistance multiple times, the price breaks out of the channel upwards, indicating strong buying momentum.
5. Previous Swing Break: After the breakout, the price breaks the previous high (previous swing), confirming the breakout.
When this happens, it’s a strong signal that the trend might be going up. So, keep an eye on these key levels to spot potential opportunities!