Advanced system #5 (Trend Lines Breakout System)
Submitted by Edward Revy on June 3, 2007 - 15:20.
Breakout systems like this are always in great demand. It is quick, easy and with a proper use has a true winning rate of over 90%.
Currency pair: GBP/USD, EUR/USD - tested. Other pairs may also be used.
Time frame: 1 hour.
Indicators: none.
Trading setup:
For this Forex system to work properly a trader needs to know the basics of identifying swings high and low, rules of drawing trend lines, plus be able to use Pivot Points.
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Hello Edward,
With this strategy, if you're stopped out and price reverses and breaks the other trend line within the 5 candle rule is it OK to reenter again?
I hope this day finds you doing well and thank you for sharing your knowledge with us.
Again, thank you kindly sir! Have a great day
Phil L.
Hi Phil,
Yes, it is ok.
In fact, my trading approach would stop me out and get into the opposite trade automatically since I don't monitor the price, but rather set two orders: Buy Stop and Sell Stop with an initial stop loss close to the opposite trend line and of course before the opposite order (so that I have the stop hit and only then the opposite order triggered) and walk away for a couple of hours or study other charts. If I happen to be around when my order is filled I adjust the stop as described in strategy rules.
All the best in your trading!
Edward.
Dear Edward
Thx you so much
Could i draw a down/up trend for a previous day and the angle of the trend about 10 or 15?
is the angle of the trend important?
Regards
Hi, trend lines must be drawn the way described in the rules. The angle of the trend is not important at all.
Thank you.
Edward.
Greetings ,
I use this strategy on 4 currency pairs, trading 3 days per week over a one month period. This is a total of 48 trades for the month. I missed a few breakouts, hence 45 trades.
regards
Terrence Muir
http://www.forexnetworth.com
Edward,
I will be greatful if you could you explain the statement below in detail as my understanding is for a breakout system there has to be upper and lower limit for entry. An example will be appreciated.
"If a trader sees, for example, no Swings High in the 5-candle range, that means there will be no downtrend trendlines this morning. "
Thanks
Chand
Chand,
That's easy to explain. You said that for breakout system there should be upper and lower limits for entry. This is when you are going to enter in either direction the price breaks. When I say that there is no downtrend line this morning, this means that we simply won't be placing Long orders today, because we have no upper limit to guide us through. But we can still expect downward moves and set Sell orders according to our uptrend trend line.
The situation when we miss either swing high or swing low isn't rare. That's because quite often the market decides firmly on its direction as early as 1-2 am EST and then it can move without stops and retracements until it meets the first or even second Pivot support or resistance.
In such cases I say that we missed a move today.
Regards,
Edward.
Hi all,
Pls you all pros can u help me out with this.
I trade from Nigeria which is +1 UTC time and i need an help in starting up ith trading times.
I have a good understanding of the candle stick charts and drawing pivots from 12:00am yesterday to 12:00am today (i.e midnight to midnight).
Please i would like to know how to use this system step by step as a new trader i use FXSOL trading platform or you can also advise me on which platform is easy and good for a starter like me.
Thanks Oladokun,
fapohunda_oladokun@yahoo.com
pettydelby@yahoo.com
Nigeria.
Plese you could mail me.
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