A trendline breakdown occurs when the price of a stock falls below an established upward trendline that has been connecting higher lows over time. This breakdown indicates that the previous bullish momentum is weakening and sellers are gaining control in the market. When the price decisively closes below the trendline with strong volume, it often signals a potential trend reversal or the start of a downward move. Traders usually watch for confirmation such as a retest of the broken trendline acting as resistance before considering short positions or expecting further downside in the stock.