Further analysis should be applied to the breakout by looking for gaps, accelerated price movements and volume for confirmation. Confirmation is especially important for upside breakouts. Prices sometimes return to the breakout point of apex on a reaction move before resuming in the direction of the breakout. This return can offer a second chance to participate with a better reward to risk ratio. Potential reward price targets found by measurement and parallel trendline extension are only meant to act as rough guidelines.
Technical analysis is dynamic and ongoing assessment is required.
Conseco formed a rather large symmetrical triangle over a 5-month period before breaking out on the downside. After the first 4 points formed, the lines of the symmetrical triangle were draw. The stock traded within the boundaries for another 2 months to form the last 2 points. After the gap up from point 3 to point 4, volume slowed over the next few months. There was some increase in volume in late June, but the 60-day SMA remained in a downtrend as the pattern took shape.