Best Thread GBP/USD Breakout

[FormulaOneFan]

Err, perhaps but I don't see the reasoning behind it?

Basically you are saying 1 trade reaches +18 pips, then trade 2 triggers. If trade 1 moves another 2 pips to +20 pips trade one closes.

Where would you put the stop loss for T2?

Would you enter the same trade size for T2?

All these questions have to be answered!

I was thinking out loud mate. Maybe it doesn't work. My point is...we should lock that 20 pips profit and then keep going. If it breaks clean then we make more money. If it doesn't work then we still get out with profit. For this to work the S/L for T2 would have to be very tight but cable can easily hit S/L. I will probably go for half a size for T2.

 

[Claudia123]

I was thinking out loud mate. Maybe it doesn't work. My point is...we should lock that 20 pips profit and then keep going. If it breaks clean then we make more money. If it doesn't work then we still get out with profit. For this to work the S/L for T2 would have to be very tight but cable can easily hit S/L. I will probably go for half a size for T2.

Formula - don't be greedy take 20 or 25 points and be happy. As Gamma said earlier this gives around 400 points a month. Win rate is very high for simple reason you buying/selling
into a trend. Stake £20 point on and you get a very nice living tax free. Don't complicate it.

 

[HawkTrader]

I was thinking out loud mate. Maybe it doesn't work. My point is...we should lock that 20 pips profit and then keep going. If it breaks clean then we make more money. If it doesn't work then we still get out with profit. For this to work the S/L for T2 would have to be very tight but cable can easily hit S/L. I will probably go for half a size for T2.

It's good to think out loud, never know what might come out. Actually I had a similair idea and we were discussing it on the Trading Naked - Part 2 thread. The members there who are more experienced than me, said it would probably be better if we added T2 when our setup reoccurs rather than just when it hits so many points. In a short entry, Cable pulls back and makes a new low, when T1 is around 20 points in profit so then you go short again with T2? Or perhaps a pullback entry with T2...

 

[foredog]

lol Hawk - but if i'd run my trade yesterday I been 100 + better off instead of 25

I've not really looked into this so just a theory.

It would make very little difference to overall returns if you went for a trail trying to hit the 100's or a fixed 25. How often will you get 100? How many times will you end up with 0?



Maybe a little bit more profit but then you got the extra hassle of working the trader rather than Claudia's set and leave.

 

[Crawsthorne]

Formula - don't be greedy take 20 or 25 points and be happy. As Gamma said earlier this gives around 400 points a month. Win rate is very high for simple reason you buying/selling
into a trend. Stake £20 point on and you get a very nice living tax free. Don't complicate it.

Out of interest Claudia, please can you tell me what your entry was yesterday? Did it not pull back 20 and stop you out? My research shows you can normally get 30 pips?

Thanks

 

[Claudia123]

Dunno is the answer. Keep it simple at 20/25 and don't be greedy I guess.

 

[Claudia123]

Out of interest Claudia, please can you tell me what your entry was yesterday? Did it not pull back 20 and stop you out? My research shows you can normally get 30 pips?

Thanks

Hi

Yesterday entered at 16446.6 just after 7.00 am and exited at 16472.5 at 7.30 am exactly (GMT).

 

[HawkTrader]

Dunno is the answer. Keep it simple at 20/25 and don't be greedy I guess.

Don't be greedy, are you sure??

I didn't catch this even though it's my favorite set up. It's very frustrating when you take one trade, it results in breakeven and then you miss the next and it makes you over 4x risk...

 

[gamma]

I hope everyone has finished for the day on the breakout.

I would like to show how I trade this setup.

The first thing I do is note the trend.
the pivot points
Yesterday's high low
Once I have an an idea of trend
I note the 12am open and the 7am close (Aussi Market)and the high low for that time frame.
Draw a fib from the high/low or low high according to trend
As I mentioned pivots earlier I will emphasize this as price generally is drawn towards pivots.
Once you have drawn the fib, sit back and watch the action on the 5 min chart

Our entry is based on candle price action around the fib numbers.
If we get a reversal candle at the 23% fib we enter
wait for the 5min candle to complete before trading.
If it spikes past the 23% fib its a no trade.
even if the next candle goes negative.
Repeat the above exercise at the next fib level.
remembering that if it spikes past the fib, its no trade.
Should it go past all the fib levels the next possible entry should be the 12 -6 high low price.
Again a spike past this price, invalidates the entry and invariably the whole setup.



This system not only gives you a better entry but also helps you from possibly not entering a trade when the trend might be changing.

This morning was a classic example of the daily and 4 hour trend showing a very determind downtrend which turned.
I use this setup every morning you might want to adapt it to your own trading style.

 

[FormulaOneFan]

I hope everyone has finished for the day on the breakout.

I would like to show how I trade this setup.

The first thing I do is note the trend.
the pivot points
Yesterday's high low
Once I have an an idea of trend
I note the 12am open and the 7am close (Aussi Market)and the high low for that time frame.
Draw a fib from the high/low or low high according to trend
As I mentioned pivots earlier I will emphasize this as price generally is drawn towards pivots.
Once you have drawn the fib, sit back and watch the action on the 5 min chart

Our entry is based on candle price action around the fib numbers.
If we get a reversal candle at the 23% fib we enter
wait for the 5min candle to complete before trading.
If it spikes past the 23% fib its a no trade.
even if the next candle goes negative.
Repeat the above exercise at the next fib level.
remembering that if it spikes past the fib, its no trade.
Should it go past all the fib levels the next possible entry should be the 12 -6 high low price.
Again a spike past this price, invalidates the entry and invariably the whole setup.



This system not only gives you a better entry but also helps you from possibly not entering a trade when the trend might be changing.

This morning was a classic example of the daily and 4 hour trend showing a very determind downtrend which turned.
I use this setup every morning you might want to adapt it to your own trading style.

Nice one gamma. If it is not too much trouble could you put a chart as an example as well please? A nice chart could be useful for new members to this thread. thanks.

 

[FormulaOneFan]

Out of interest Claudia, please can you tell me what your entry was yesterday? Did it not pull back 20 and stop you out? My research shows you can normally get 30 pips?

Thanks

crawsthorne, please see attached chart for yesterday's trade. I think based on where you enter you could be stopped out i guess.

 

[gamma]

Nice one gamma. If it is not too much trouble could you put a chart as an example as well please? A nice chart could be useful for new members to this thread. thanks.

No prob FormulaOnefan,

Here is a chart.
It is well worth noting that just after the Aussi the price was drawn to the daily pivot.
and it broke it to the down side.
This would have invariably led us to belive that the market was in a down trend and would have prompted a sell.
After drawing the fib from the high to low one will see that at no point during the pullback did the price action offer a sell opportunity
Although the trend was definately down.

I was absoluty certain we were in a down trend according to the daily and 4 hr, Not seeing an opportunity on the pullback I did not enter on that strategy into what would have definately been a losing trade.


Just like to add that its well worth also keeping an eye on BBMAC'S thread while going for a breakout trade.

Also please excuse duke can't get him off the monitor and he insists the strategy is his.

 

[Crawsthorne]

Hi

Yesterday entered at 16446.6 just after 7.00 am and exited at 16472.5 at 7.30 am exactly (GMT).

Thank you for that. I am sorry to be a pain, but can you tell me what times you use for your highs and lows as I had a high of about 16462 at 0035 on yesterday's chart?

Many thanks

Charles

 

[Claudia123]

Thank you for that. I am sorry to be a pain, but can you tell me what times you use for your highs and lows as I had a high of about 16462 at 0035 on yesterday's chart?

Many thanks

Charles

Hour bar - my high low ignores the spikes. Close of 1 am close of 6 am.

 

[FormulaOneFan]

Hour bar - my high low ignores the spikes. Close of 1 am close of 6 am.

Hello Claudia, do you mark and ignore a candlestick as spike if they are over a particular pip value? for example: if a particular candle between 00:00 - 06:00 close is over 35 pips then do you consider it as a spike and ignore it? please let us know.

 

[FormulaOneFan]

Today it looks like high is 1.6694 and low is 1.6649. The PA broke the high by 1-2 pips but I didn't enter long as I'm not sure about this. Its very slow and everything has come to standstill. Its a waiting game now I guess.

 

[HawkTrader]

Today it looks like high is 1.6694 and low is 1.6649. The PA broke the high by 1-2 pips but I didn't enter long as I'm not sure about this. Its very slow and everything has come to standstill. Its a waiting game now I guess.

Good idea FormulaOneFan. In fact I'm looking for a short if I get some confirmation. Pretty strong Resistence at 700.

 

[Claudia123]

I long at 695 - 700 is gonna be tough for sure.

 

[FormulaOneFan]

Good idea FormulaOneFan. In fact I'm looking for a short if I get some confirmation. Pretty strong Resistence at 700.

Indeed. it looks like it needs to go south. But the current high is not far away from the high set on 25th/26th. If it goes up its next resistance level is that and that's 30 pips away. Its a waiting game now.

 

[HawkTrader]

Indeed. it looks like it needs to go south. But the current high is not far away from the high set on 25th/26th. If it goes up its next resistance level is that and that's 30 pips away. Its a waiting game now.

Yes. But if you take a look at the longer timeframes like 4H and Daily, some of the big players have been waiting a long time to sell off these levels and they won't care that it's got an extra 30 points to go. Look how small 30 points is on the higher TF.

But maybe... maybe I've spoken too soon.