Scalping system #2 (Morning breakouts)
Submitted by Edward Revy on April 22, 2007 - 10:03.
The closer time gets to 8:00 EST in the morning the less movements can be seen on the chart. It is a well known fact that once the Forex market “hears morning bell” at 8:00 am it is going to really move – stretching well doing morning exercises :).
What is needed from traders?
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Thank you Dimitris,
you can trade forex both ways: manually or automatically. To automate trading, you need to write an Expert Advisor (or have someone to write it for you).
Formula-wise the correct one is, of course:
Sell = low - spread - 3 pips.
Sell = 1.5850 - 1 - 3 = 1.5846
In the first one I simply meant adding the spread cost and another 3 pips, of course, when Selling, you'll be looking "to add the spread cost into the calculations" by actually subtracting the value.
An initial investment of 10-20k is a huge one for a beginner. You'll be able to survive the challenge undoubtedly, but will you be prepared mentally and professionally to manage such a serious account. I'd recommend a smaller investment around 1k in your case. Later you can always add up if you trade successfully.
Kind regards,
Edward
Hello Edward! I really want to tell you a big thank you for your job here, I am new in forex and your website has helped me to find an exit to the tunnel!
I am trying this strategy and I sometimes I don't make it on time to place an order on both couples of currencies (EURUSD, GBPUSD), since I do that manually. my question is ,is there anything I can do automatically,if not, how do you do that?
One more question: on April 13, 2008 - 06:07. page 5 you wrote:
Set Buy stop order above the high + spread + 3 pips.
Set Sell stop order below the low + spread + 3 pips.
And in the same page you wrote again:
Buy = high + spread + 3 pips.
Buy = 1.5870 + 1 + 3 = 1.5874
Sell = low - spread - 3 pips.
Sell = 1.5850 - 1 - 3 = 1.5846
in terms of the Sell, which one is correct? (Sell = low - spread - 3 pips.or Set Sell stop order below the low + spread + 3 pips.)
Finally, I would like to ask you something general.I really love being a forex trader and I started to deal with it on a full-time basis but I am not certain at all whether someone with an initial capital close to 10,000-20,000 pounds can really survive in this job?I would really appreciate your professional opinion on this!
Looking forward to your response.
Thank you in advance.
Kind regards,
Dimitris
I think we can take 5 pips+spread stop and place the equal to stop TP, this way we will trade with 1:1 risk:reward = need to win only 50% of the time.
To pull the odds in our favor, I think we need any trend indicator to take only trades that go with the trend.
Hi,
It is a good strategy and seems to work the majority of the time, however my only issue is that with a 10pip SL and 5pip TP (as an average) you would need to win more than 75% of the time to be profitable? Are there any other known methods of how to increase the risk to reward ratio?
Cheers
J
The principle still works and will continue to work, the other thing is that many I think have found some other additional ways to look at the market and breakouts after 8 am. After all, it is clear that when the market is open a price will move.
Hi,
Are you guys still using this strategy? How has it been working for you?
Good luck next time!
just got blistered on morning breakout (hit stop loss in 5 minutes). went too low by using the previous 3 half hour candles instead of the previous one hour candle. at least i HOPE that's what the problem was. will try again tomorrow using previous one hour candle only.
Around pivot points price will pause and retrace or slice through the pivot. In both cases it'll be followed by quick moves, which one may find difficult to catch.
Around large Moving averages price often begins to range before resuming a trend, thus entering a trade might be problematic.
what does alex mean about being careful around "pivotal" points and "big moving averages"? does he suggest not trading at these times?
Advanced #3 and #5 are my favorite.
Regards,
Edward
so ed, of all these various strategies, which is your favorite.....which do you play most of the time?
There is more than enough volatility to hunt pips on both ways.
Regards,
Edward
Ed, just tried the morning breakout for the first time friday (8:00amEST...Eur/USD) and it executed both trades and i won on both (5 pips). do you think that was a fluke or is it possible there is usually enough volatility to execute both??
Yes, if you can code it ;)
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