CDLBREAKAWAY (CDLBREAKAWAY)

CDLBREAKAWAY (Breakaway) is a five-candle reversal pattern showing a trend exhausting through a failed breakout attempt. For bullish Breakaway: Starts with a long bearish candle during a downtrend. Second and third candles gap down and continue making new lows (the 'breakaway' from previous support). Fourth candle may continue slightly lower but shows weakening momentum. Fifth candle reverses strongly upward, closing within the gap created by the first and second candles. The pattern shows bears creating a breakaway to new lows, but the momentum fails and bulls reverse the move. Bearish version inverts this at tops.

Breakaway patterns identify failed breakouts where a trend attempts to accelerate but instead exhausts and reverses - a powerful scenario for contrarian traders. The pattern shows that the dramatic move to new extremes (candles 2-4) couldn't sustain, representing trapped traders and an imminent reversal. Enter bullish positions when the fifth candle closes back into the initial gap, confirming the breakout failure. For bearish setups, short when the fifth candle closes into the top-side gap. This pattern is particularly effective in crypto markets where false breakouts and liquidity grabs are common. Combine with support/resistance levels (the pattern often occurs at key levels after stop-hunts), RSI showing extremes during candles 2-4 then reversing, and volume declining during the breakaway then increasing on the reversal candle. Suits experienced traders who recognize failed breakout dynamics.