Beginner's Guide: Identify Breakout Trades with Volume with Tally Prime

Beginner’s Guide: Identify Breakout Trades with Volume with Tally Prime

Trading breakouts successfully requires both technical understanding and discipline. For new traders, mastering how to identify breakouts using volume confirmation can be a game-changer. In this practical guide from AI Computer Classes – Indore, we’ll show you exactly how to recognize genuine breakouts, interpret volume data, and even manage your trading performance using Tally Prime — all in a structured, hands-on way.

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🧩 Step 1: What Is a Breakout in Trading?

A breakout happens when the price of a stock moves beyond a significant support or resistance level with higher-than-usual trading volume.

📊 Types of Breakouts:

• Upside Breakout: When price moves above resistance with strong buying volume.
• Downside Breakout: When price drops below support, often accompanied by heavy selling.

💬 Example:

If TCS consistently trades between ₹3,400 and ₹3,500, a move above ₹3,500 on strong volume signals a potential breakout.

📈 Step 2: Role of Volume in Confirming Breakouts

Volume is the fuel behind price movement.

A breakout is only reliable when supported by significant volume.

🔍 Volume Confirmation Rules:

• Rising price + High volume → Bullish breakout confirmation
• Falling price + High volume → Bearish breakout confirmation
• Low volume → Possible false breakout

💡 Use Excel or Power BI to chart daily price-volume relationships for visual clarity.

🧠 Step 3: How to Identify a Genuine Breakout

Follow these steps before acting on any breakout signal:

1. Analyze chart patterns like triangles, flags, or rectangles.
2. Wait for candle close beyond resistance/support levels.
3. Confirm volume is 1.5x or more the average of the last 10 sessions.
4. Check RSI or MACD indicators for additional confirmation.
5. Set stop-loss just below breakout zone for risk management.

💬 Example:

If HDFC Bank’s average volume is 10 lakh shares and today’s breakout occurs with 18 lakh shares — it’s likely genuine.

⚙️ Step 4: Tracking Trades using Tally Prime

While Tally Prime is primarily an accounting tool, it can be leveraged to track and evaluate trades efficiently.

🧾 How to Do It:

1. Create a new ledger: “Stock Trades” under Investments.
2. Record buy/sell entries with date, price, and volume.
3. Use Custom Fields to track indicators like RSI, MACD, or breakout zone.
4. Generate Reports → Ledger Vouchers to review trade performance weekly.

💡 Pro Tip: Export your Tally Prime data to Excel for further analysis and chart integration.

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🧮 Step 5: Using Excel to Backtest Breakout Strategies

You can use Excel formulas to test how often a breakout led to sustained price moves.

✅ Example Setup:

DateStockClose PriceVolumeAvg VolumeBreakout?Profit/Loss10/01/25Infosys165014L9L✅+2.5%11/01/25Infosys16206L9L❌-1.8%

💡 Use Excel’s Conditional Formatting to highlight strong-volume breakouts.

📊 Step 6: Visualizing Breakout Data with Power BI

Power BI can convert raw trade data into clear, interactive visuals.

• 📈 Bar charts for daily volume comparisons
• 🔵 Line graphs for price momentum
• 🟩 Heat maps for breakout frequency

These visuals help traders quickly spot volume surges and breakout consistency across different stocks.

💬 Example:

If Power BI shows a correlation between price spikes and volume jumps in the same sector, it signals potential trading opportunities.

🧭 Step 7: Avoiding False Breakouts

Even professionals get trapped in false breakouts — where price briefly moves past resistance but then reverses.

🚨 Avoid These Mistakes:

• Acting before candle close confirmation
• Ignoring volume weakness
• Skipping cross-check with higher timeframes (1D, 1W)
• Not setting a proper stop-loss

💡 Always wait for retests. A true breakout often retests the broken level before continuing its move.

💹 Step 8: Record & Review Trades Weekly

Consistency is the key.

Every successful trader maintains a trading journal to reflect and improve.

🧾 Try This in Tally Prime:

• Record trade details daily
• Summarize profit/loss weekly
• Add remarks for each trade (e.g., “Breakout above 200DMA”)
• Compare win rate monthly using Excel Pivot Tables

💬 Insight:

By tracking your trades digitally, you’ll start identifying personal patterns and improve discipline.

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Learn to combine Charting (TradingView) with Data Analytics (Power BI, Excel) and Accounting Tools (Tally Prime) to trade smarter — not harder.

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🧭 Conclusion

Understanding breakout trades is one of the most rewarding trading skills you can master.

By combining technical analysis, volume study, and record management using Tally Prime, you can trade with more confidence and clarity.

At AI Computer Classes – Indore, we help students bridge the gap between market theory and data-driven execution — equipping them with professional-level trading and analytics skills for real-world success.

📘 Learn smart, trade smarter, and manage your results efficiently with the right tools!

📞 Contact AI Computer Classes – Indore

✉ Email: hello@aicomputerclasses.com

📱 Phone: +91 91113 33255

📍 Address: 208, Captain CS Naidu Building, near Greater Kailash Road, opposite School of Excellence For Eye, Opposite Grotto Arcade, Old Palasia, Indore, Madhya Pradesh 452018

🌐 Website: www.aicomputerclasses.com