Advanced system #4-a (London GBPJPY breakout)
Submitted by Edward Revy on March 2, 2009 - 16:24.
Submitted by Stuart Williamson
This strategy is based on the London Market.
Currency Pair: GBPJPY
Timeframe: 1 hour
Strategy:
Before London opens, at 08:00 GMT, mark the High and Low of the last 4 hours - from 04:00 until 07:59 GMT. Set your Buy and Sell orders 10 pips away from those highs and lows.
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Hi Edward
This strategy should hold good for any currency is'nt it? i am very new to forex and i am still testing this strategy . You got a great well done
Aryan
Hi Aryan,
yes, I would try it on other pairs too.
Regards,
Edward
Hello,
This strategy doesn't seem to be working any more. I back tested recent weeks and most of the trades have failed. Do you still use this strategy?
thanks
Sam
Hi,
I agree that the strategy is no longer reliable and the losses can be huge if the trade goes against you.
We should adjust the hours.
As Edward says, breakout strategies use to lose their effectiveness over the time, and while the methodology leaves, the hours need adjustments.
Thomas
the strategy only works if the daily range is more than 150pips. Below that, it will whipsaw hard. November and Dec seems the daily range is below 150pips. Use it again once the range picks up
Hi everyone - this is my first post, so I'll try to keep my questions concise!
Re the times for breakout - with Frankfurt opening at 7am GMT (and a good number of moves driven from this), would it perhaps be more effective to study the 3AM to 7AM bars in order to capture the early breakout?
Re the comments on Daily Range: 150 pips seems like quite a round number, are there backtest results to support this? Is this looking at average daily range, or previous days range?
Finally, I must offer my sincere thanks to Edward for this site. It's amazing! I spent thousands with a 'professional' training company to learn about 3 strategies (that are almost useless in this ranging market) and learned more on here for free than I learned on the course!
Hi,
first of all, thanks a lot for the feedback. It means a lot to me and my team.
It makes sense to start an hour earlier to trade with Frankfurt opening. Definitely should be tried.
I would refer 150 pips to the average daily range here (for GBPJPY). It is a round number, but very reasonable and based on the historical volatility of the pair.
If the average daily range is less than 150 pips, it wouldn't be right to hope to capture 100 pips on the breakout, somewhere around 70 pips is possible, while going for more will simply not reach the target.
Best regards,
Edward
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