Trading Breakouts: The Breakaway Gap Setup

Swing traders are always on the lookout for momentum stocks that make explosive moves in a short period of time.  The breakout breakaway gap setup is by far the best setup for swing traders looking for explosive price action. It is also great for part-time traders who don’t have time to day trade.

There are 4 elements to the breakout breakaway gap setup:

1) a breakout from a developed range

2) a big gap from that range

3) high volume relative to previous volume (at least 2-3 average volume)

4) the breakout is on tangible news such as earnings, rather than rumors and speculation.

In this video we go over $GOOGL to illustrate the power of the breakout breakaway gap setup.

Now that you have watched the video, find some breakout breakaway gap examples in momentum stocks that made explosive moves and share them in the comments below.

This is part 3 in the trading breakouts series  “The only setup you need to know”.

Part 1: The breakout pullback setup

Part 2: The breakout-remount setup

My focus list is, market analysis and trade alerts are all featured in the Market Speculator Part-Time Swing Trade Report.  If you would like to receive the swing trade report and alerts, sign up for the free trial.  Follow me on twitter or email me at

Paul Singh Administrator

4 thoughts on “Trading Breakouts: The Breakaway Gap Setup”

    • It depends on your risk and positions sizing. If your risk parameters allow you to take a bigger stop, then you can be more forgiving with your entry. If not, you must wait for a pullback, generally to the bottom of the breakout bar.


Leave a Comment