Forex trading strategy #7 (Simple breakout System)

Hi Edward,

Just a quick question. Can we use this system on other currency pairs ? I realise that the stop/limit is tailored to the GBP/USD pair, but presumably this system would work (for the same time frame) for other major pairs (EUR/USD, GBP/JPY,...) as well since the London and Frankfurt markets will trade other pairs with similar enthusiasm.

What do you think ?

Thanks,

Andrew

Hi Andrew,

Could be tried, why not. When GBPUSD moves, other pairs don't pause obviously, they also on the move. It is just that we used to treat GBPUSD as a breakout pair more than any other: it has a low spread and a high daily range.

Regards,
Edward

hi edward

just wondering, if the candle we are looking at should be from 6am GMT to 7am GMT which hour candle do we focus on? the candle that opens at 5am or 6am? For example the current live candle i am looking at says 7am but real time is about to turn to 9am i dont understand that why the candle is an hour behind real time please help

thank you

Jason

you are jesus of forex to deliver us from loosing all the time

Hi Jason,

To simplify it, we are taking 5 min chart, where we're looking at the time range from 6 am GMT to 7 am GMT.
On hourly charts it'll correspond to 6 am GMT candlestick.

If you have differences between real GMT time and what trading platform shows you, it is because your trading platform runs in a different time zone (which is preset and cannot be changed). You need to figure out what time zone it runs on and then adjust hour count to GMT timing.

Regards,
Edward

Hi edward,

thanks for you help, i have a very good overall success rate but i lost a trade today due to a false breakout, what do you recommend i do in such circumstances? do i re-enter on the next breakout or leave it for tomorrow?

Thanks for all your help
much appreciated
Jason

Hi Edward,

Another quick question, are there anytime that we should avoid using this strategy? and are there any indications that can identify a potential false signal?

Thank you
Jason

Hi Jason,

There is no particular time we should avoid here, just probably only before and after major holidays.

Regarding indicators, I remember there were some suggestions on page 2 of this discussion (referred to Bollinger bands). Also consider adding Pivot lines and 200 EMA - both will suggest the levels of support/resistance, so that, for example, if you get a Buy signal right under the resistance level, you know that you should hold on till you see that resistance being breached, otherwise, upon Long entry into resistance area, the chances are high that the market quickly turns against you.

Best regards,
Edward