Forex trading strategy #7 (Simple breakout System)

Thank you Thomas.

When the EST timing changes, you follow it. E.g. when it changes to daylight GMT-4, you still use the same hours: 1:00am EST (GMT-4) to 2:00am EST (GMT-4).

When it goes back to Standard time (GMT-5), you'll use 1:00am EST (GMT-5) to 2:00am EST (GMT-5).

Thomas

Actually, I got confused about H1 candle. EST timing now has been changed. Please let me know exactly the timing of the strategy.

Regards
Uniperse

Hello User,

related: "Ok guys so I programmed an EA based on just the original set of rules o"

I am a EA developer and trader . I believe can help you with my existing framework to get the EA profitable. It provides you with sophisticated exit strategies and you can simply add any strategy in an extra mq4 file, which you can maintain yourself without bugging around with lots of code around the trade management.

so if you, (or anyone else here) wants to give it a try adding your entry signal to the system, I would give away the core trading system for free.

I would support with additional features if you need more functionality to it.
I would assist with optimization of the strategy as well with providing VPS systems to forward test.

I am not selling the system or any of my existing successful strategies. plz dont ask me this.

But I am looking for partnership in such projects to gain inspiration. most strategies are not profitable simply by entering an entry signal +TP.
Automation and trade management are the science to make even a 50/50 system profitable. I believe I have already a solid fundament for that.

Thank you, S.Z

Good luck in your trading as well!

And thanks for a valuable comment and the insight into your Forex trading approach.

Kind regards,
Edward

Hi Edward,

I started using this strategy 2 months ago and what best works for me is:
1. S/L=range of the tunnel
2. TP=45pips and I use TP1,2,3 Basically I move S/L manually just under the highest low or the lowest high of closed 5M candle.

20 pips S/L works like spike magnet for many brokers, many times i watched my S/L get hit than a while after TP1-3 was hit. Also my mentor and great trader never ever uses S/L smaller than 30-35pips. I also always determine long term trend on a daily,weekly chart and use TL's and support,resistance lvl's. As for indicators most of them are useless indeed due to being laggy, I use only Fractals, Parabolic SAR and EMA 10.
Loses are part of the job but good Money management is the key to success so if you have 2 losing trades STOP trading for the day and never ever try to get your money back on same day as you will only lose more. Also never make a trading decision based on open candle.

Thank you Edward for great job you doing here and good luck to you all!
Have a great weekend and fantastic trading weeks!
May all your trades be winners!
S.Z

Thanks a lot for your advice and your time!

kind regards

Dimitris

Hi Dimitris,

it would be difficult to give the numbers, since we have constantly changing market conditions and every month it could be something new.

I would definitely recommend spending more time on the demo account. Besides, try to start with the exact amount of money you're planning to invest in the real account. This way you'll get the best experience on demo and will know whether you're ready for a live trading.

Kind regards,
Edward

Hi Edward,

My name is Dimitris and I am new to forex trading and your website has helped me a lot and I would like to thank you for the time you spend for us!

During the last two months I am trying to complete my trading plan and I am trying to find a strategy to use for moving from the demo account to a live one (I'm not really sure if it is correct for someone to spend two months preparing a trading plan and a few time in front of a demo account!!!!).

My question is this: Using a demo account, I have been testing statistically this strategy with the numbers provided from 4 weeks (22/03/2010-16/04/2010) and I see that the two weeks (22-26/03 & 05-09/04) give you only a total of 20 pips each, one week (29/03-02/04) gives you -20 pips and the last week (12-16/04) gives you a total of 60 pips. I was wondering what is the average number of pips we expect from this strategy per week or per month? Can you suggest anything for false signals to a novice trader as myself?

Thank you in advance for your time!

Kind regards,

Dimitris

I've got no additional suggestions so far. Would appreciate any ideas from other members.
Thank you for sharing the results, great job, great feedback!

Best regards,
Edward

Ok guys so I programmed an EA based on just the original set of rules on this one and have backtested and here is what I have found. Starting with a 10,000 account backtested about 6 months gives a 17,100 balance. I found the 5M chart to be good, the 1H chart to be better, and the 4H chart even better (4H chart was tested by accident) after optimizing I found the best settings were 90pip stop 50pip take profit. I am wondering if anyone has any suggestions on what I might be able to add to this EA to get the risk to reward ratio to a more comfortable level even though it performed very well that risk reward ratio concerns me.

Thanks

Hi Edward.

I won't abuse, posting many strategies of your authorship.
Thanks for your permission!

Best regards,

Rui

Hi Rui,

Thank you for asking.
Sure, it is ok to post a strategy or two in your blog while linking back to our pages.

I hope that you'll use my permission wisely, but I have to make a note that extensive re-posting of our content is not permitted.
Thank you for your understanding and cooperation!

Best regards,
Edward

Hi Edward,

I have a blogger and I would like to post your strategy on my forex blog, in portuguese, so I am asking permission to do that. If you agree with that, I will obviously post your name and a link to here.

What do you think about it?

Best regards, Rui

Good point, thank you.

During a breakout to the upside, when a signaling candle (the first whole candle to close outside the channel) is bearish, it would be rational to postpone our entry. When the negative momentum is forming, we don't want to run against it - makes little sense - not only for this strategy, but for other strategies as well.

It is in or best interest to go with the momentum. I support your choice and a new rule that on a bearish candle it is better to postpone the entry, until the momentum returns: until we have a bullish candle, or if price advances up past the bearish candle, as shown on the illustration below.

I use this entry method quite a lot.
The idea is on a downward retracemet place a Buy stop above the last closed candle.
If the entry is not filled, trail it down to the next closed candle, and so on until you get filled.

Best regards,
Edward