Chart analysis attempts to predict the future price development of securities on the basis of historical price trends. Typical patterns in the price charts (e.g., double tops, V formations, head-and-shoulders) are used to identify short-term trends. Support and resistance lines, which are of particular importance in chart analysis, are derived using historical price charts. A new trend is signaled by a breakout, in which a price drops below its support level or rises above its resistance level.