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The classic breakout model is the Donchian method. Basically if prices are above a 200-ma and then breakout above the highest high in n days, where n can be any length. The trade is closed when prices break back below x days, where x is shorter than n.

In general terms, a high n will create less trades and keep the system out of much noise. As a rule of thumb, the higher x is the larger the trend that will be captured, although the larger the open profit giveback is.

In modern day breakout systems, traders attempt to add other filters some of which are macro based. As an example, breakout systems will be working well in Coal, Oil and Energy sectors on the upside and perhaps Financials and Discretionary Spending on the downside.

Many classic breakout models are used in commodities rather than equities for correlation reasons.

I traded the original Turtle model, a variant of Donchian, back in 2001 for about 8-months and found it quite tough.

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