TD Breakout Qualifiers

Once TD-lines have been broken, a trader needs to define if the price breakout is true. Thomas Demark suggested TD Breakout Qualifiers:

* The first TD Breakout qualifier. Downward breakout is considered true if the bar's close prior to the breakout is higher than the preceding bar's close:

* How to use the first TD Breakout Qualifier
Upward breakout is considered true if the bar's close prior to the breakout is lower than the preceding bar's close.

* The second TD Breakout qualifier.
Upward (downward) breakout is considered true if the bar's open, which is the breakout of the trendline, is higher (lower) than the descending (ascending) TD-Line:

*How to use the second TD Breakout Qualifier
As the second Qualifier is stronger than the first one, it is reasonable to open a position even if the first TD Qualifier indicates a false breakout.
* The third TD Breakout Qualifier.
Upward breakout is considered true if the sum of the bar's close before the breakout, and the difference between the close and low of the same bar (or close two bars before the breakout, if it is lower) is lower than the breakout price:


*How to use the third TD Breakout Qualifier
Downward breakout is considered true if the difference between the bar's close before the breakout, and the difference between the high (or the close two bars before the breakout if the latter is higher) and the close of the same bar is higher than the breakout price.

• 
  

source : www.alpari.com