Advanced system #5 (Trend Lines Breakout System)

I haven't faced that situation till today. I did re enter twice in the opposite direction after I got stopped out. Those were successful trades. As you fell giving it a try is worth it, I shall try that on one of my demo and see. I shall let you know the results. Thank you. I really appreciate your willingness to help others.

krishna

This strategy looks interesting to me and I appreciate you trying to help fellow trades. The one question I have is basically u draw the trendlines at 5am est time and then wait for a breakout...where I get confused is how far back to u go on the chart to draw the lines from? Looking at the eur/usd right now I can see a uptrendline fairly close but in order to draw a downtrendline I would have to go many hours back to find a higher high then the current price. In this situation would you not draw a downtrendline and basically only trade a reversal to the downside?
Thanks in advance,
Markus

PS...has anybody tried this on any other pair? especially wondering about the yen crosses?

Hi Markus,

There are no limits of how far back a trader can go on the chart to find a valid top or bottom to draw trend lines from. On my charts I zoom out as much as I need till I find the right point for my trend line.

I've tried this strategy on yen crosses. It worked fairly well, still EUR/USD and GBP/USD pairs were the most accurate here.

Happy trading!
Edward.

Hi Edward

Can you stress on how to identify swing highs and lows. If we find swing high the previous day, can we draw a trend line to it. OR should we look at few days back. If yes how many days. I drew trend line to the previous days high a few times and got stopped out. I guess that is not the way to draw. Kindly help. Thank you.

We use two most recent swings high/low we can find on the chart (the first should be found within our 5 candles range, the second - doesn't matter how far away it is (e.g. how many days back), the only requirement for it is to be the most recent and valid to draw up/down trend line from).

I've made some pictures for you. Hope this helps.

Regards,
Edward.

Hi Edward,

I've been trying hard to understand this strategy, and I think I do, but the problem is that I can't seem to find _any_ day having the 5 first bars calm enough to apply your strategy. Going back in my charts, it seems the action begins at 1:00 (and that's EST - although I'm not inside EST, I did the maths). I even registered at Oanda FXgame to see if I could find the May 21 day shown in your example, to see if I've got the times correctly, but their platform doesn't go back that much. Could you give another fresher example, preferably one that doesn't span through a weekend, showing the exact 5 bars beginning at midnight and drawing the trendlines? I've gone back through EURUSD and GBPUSD and can't find a single day where I could even begin to think about drawing anything - the action happens right in the second bar.

Also, if you could tell me how does that 00:00 EST align with market open hours (e.g. are you saying that the first of those 5 bars we have to monitor is the one that happens 2 hours prior to the London open?), then maybe I could understand it better, but I still would need a fresher example to compare with my charts. Oh, by the way, I can go way back in my MetaTrader4 but I still couldn't find a May 21 day that looks like yours (in both eurusd and gbpusd), that's why I'm kind of awed by the people saying it works really well and that they rarely collect losses.

Thanks for the swing high and low explanation, that really helped me. And thanks for this wonderful website of yours. You certainly help lots of people and I imagine you make a living trading forex, for which I praise you.

Hey Edward,
Here's my chart of the last 4 00:00 I can see. You see what I'm saying to you, the next 4 bars after the 00:00 bars marked in red in the attached picture are too violent and completely consume any profits I could take (and even if they didn't, I'd have no way to draw trendlines!) Please compare my chart to your charts so that I know if I'm making any mistakes regarding the time.

Here's my chart picture:

Hi,
Your charts are fine as well as timing. Starting from 00:00 EST (which as I understood is 6:00 am your local time), you should count 5 candles forward (not backwards) and look for swings high/low withing that 5 candle range.

Should you have any difficulties with Forex market hours, please have a look at: Forex market hours and tell me if there is anything else I can help you with.

Last several days weren't the best ones, that's may be why you were struggling to see any profitable trades. I've drawn trend lines on your original picture, the same way I drew them on my charts, where I've got:
Oct 10 - win
Oct 11 - nothing
Oct 12 - loss
Oct 15 - win

Hope this helps. Happy trading!

P.S. Thanks for the screen shot. Now we can also show traders that "empty days" and losses with this system are a part of everyday Forex trading routine.

Edward.