The Only Setup You Need to Know – The Breakout-Remount

My favorite setup for part-time trading is the breakout-pullback setup.  It is the bread and butter setup for swing traders who can not follow every tick in the market.  While it is a simple setup, there are a number of variations of the setup that need to be understood.  The variation we are discussing today is what I call the “breakout-remount”.

Three steps are necessary for the breakout-remount:

1.  A strong breakout clearing resistance with strong price and volume action.

2.  A breakout failure, with price violating the bottom of the breakout bar, former resistance and a moving average (20, 50 or 200 day moving average)

3.  A remount of the moving average on strong volume.

This setup often leads to powerful moves as the initial “weak” entrants are shaken out of the trade.  In this two-minute video I go over the breakout-remount setup using the recent breakout-remount setup in $NFLX.

Now that you have watched the video, find some “breakout-remount” setups and post them in the comments below, and I will give you my feedback.  New readers can review Part 1 of the series, the breakout-pullback setup.

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Paul Singh Administrator

10 thoughts on “The Only Setup You Need to Know – The Breakout-Remount”

  1. Here are some:

    adsk – has remounted the 20dma and the 50dma is in its sights.

    kate – has snapped back from huge failure after earnings; 50dma and 20dma are closeby but not sure if it will fade

    dks – failed on day 1 after earnings but remounted on day 2 and has steadily churned up since; maybe too late to enter

    zbra – a more gradual decline after brakout and then a steep breakdown but has been edging upward last few sessions

  2. ABB has a gap up 7/22/14. A breakout failure thru both 50 ma and 20 ma and then a remount on the 20 ma but not on the 50ma

  3. I thought the first video was the ONLY swing set up we needed to know. hah. j/k. Thanks for sharing. curious though why this NFLX chart not calling it a cup n handle? Or maybe its both. Anyways, thanks again for sharing, good stuff. Keep em coming. Looking to take your trial soon.


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