A breakout occurs when the price of a stock breaks through its resistance level.
The resistance level is usually a price ceiling at which the stock has previously encountered selling. In many cases, but not always, that resistance level is the highest point in a "handle" portion of a base pattern.
Breakouts are easily spotted onPoint & Figure charts as illustrated below.
Interpretation of Breakout
Technical traders will buy the security when a price breakout occurs as it is likely that additional buying pressure will follow.