Resistance breakout: does the stock keep rising?
A breakout is a close above a price where the stock has turned down before. Sellers who kept capping the price there have run out, and buyers have taken the level.
When “Resistance breakout” appeared, NIFTY 200 stocks were higher 12 trading days later 54.8% of the time, against 55.3% after any day: about the same as picking a random day.
| After | Higher | Average move | Median move | Higher after any day |
|---|---|---|---|---|
| 5 trading days | 52.2% | +0.4% | +0.2% | 53.9% |
| 12 trading days | 54.8% | +1.1% | +0.7% | 55.3% |
| 20 trading days | 56.6% | +2.2% | +1.5% | 56.8% |
Year by year
| Year | Signals | Higher after 12 days | Any day |
|---|---|---|---|
| 2021 | 219 | 57.1% | 54.4% |
| 2022 | 462 | 52.6% | 52.1% |
| 2023 | 652 | 63.3% | 61.3% |
| 2024 | 481 | 50.9% | 53.7% |
| 2025 | 301 | 44.2% | 53.1% |
| Large cap only | 1192 | 55.7% | |
| Mid cap only | 923 | 53.6% |
What it is
A breakout is a close above a price where the stock has turned down before. Sellers who kept capping the price there have run out, and buyers have taken the level.
How we detected it
Support (or resistance) is a price where at least two swing lows (or highs) from the last 50 days, each the lowest (or highest) of the 3 days either side and at least 5 days old, sit within 1.2% of each other; we take their average, using the level with the most touches. A breakout is a close more than 0.5% above resistance, when none of the previous 15 closes was more than 1% above it. We count the day of the break.
How traders read it
Many breakouts fail and fall back below the level. Traders look for heavy volume on the break, and often wait for price to hold the old resistance as new support.
A signal is a probability, not a promise
Even the most reliable signal in this study was followed by the opposite move 37% of the time. A signal tilts the odds; it doesn’t decide the outcome.
Signals work better when they agree with the trend and with each other. Whatever the signal, decide your stop-loss before you act.
Practise spotting it, free
The Support and resistance chapter teaches this signal in five minutes, then you call real NSE charts and get graded on your reasoning.
Common questions
Does the resistance breakout signal work on Indian stocks?
When “Resistance breakout” appeared, NIFTY 200 stocks were higher 12 trading days later 54.8% of the time, against 55.3% after any day: about the same as picking a random day. No single signal is reliable on its own; traders combine it with the trend and manage risk with a stop-loss.
How often did stocks rise after this signal?
Across 2,115 signals on 182 NIFTY 200 stocks (2021–2025), the price was higher after 5, 12 and 20 trading days 52.2%, 54.8%, 56.6% of the time. After any day it was 53.9%, 55.3%, 56.8%.
How is “Resistance breakout” defined here?
Support (or resistance) is a price where at least two swing lows (or highs) from the last 50 days, each the lowest (or highest) of the 3 days either side and at least 5 days old, sit within 1.2% of each other; we take their average, using the level with the most touches. A breakout is a close more than 0.5% above resistance, when none of the previous 15 closes was more than 1% above it. We count the day of the break.
How these numbers were made
We ran the same signal detector MarketSeekho uses to grade players over every trading day of 187 NIFTY 200 stocks, Jan 2021 to Oct 2025, using NSE end-of-day prices (1,54,833 stock-days). We counted the first day a signal appeared, then ignored the same signal on the same stock for 12 trading days so results don’t overlap. Windows with splits, bonuses or trading halts were left out.
“Any day” is the baseline: the same measure after every day in the data, signal or not. It matters because 2021–2025 was mostly a rising market, so stocks were higher after 12 days more often than not anyway. Past results don’t predict future ones, and this is not investment advice.