Seanyboy123
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Hello all!
Just though I'd show you my breakout trading strategy. It could'nt be any more simple, yet it works and the risk:reward ratio can be brilliant!
It's based on breakout of established ranges. Were looking for a trend line to have been tested at least 2 times, however the more times the better.
We're not going to bother with technical indicators, they'll just put doubt in your mind and cloud your judgement.
So what we want is a good established channel, as aforementioned preferably one thats been tested at least twice.
Were then going to follow price as it tests the support/ resistance lines. We'll keep it simple and boring and use a good old line chart; easy to read!
Once price has broken out of the established range we'll wait for it to close on the breakout. We're using a 15 minute chart as it gives a more reliable confirmation signal than the 10 or 5 minute. Plus I get tired of continually staring at charts, it really is'nt that fun!
So once price has broken out, we simply wait for the 'drawback'. You can see this highlighted on the chart. This is basically where price has doubts about its new found ground and wonders whether he preferred the old life in the channel.
This also gives us a chance to enter at a better price.
So we enter towards the end of the 15 period, or on the close of that period, knowing that the likelihood of the price drawing back to the channel is minimal. We set out our profit target for roughly the width of the previous channel. We set our stops as just inside the channel to give it room to breath if it does drawbackand test the level.
As can be seen from the above attachment, the trade worked to plan. I closed this trade as my targets had been met however as you can see if I had off stayed in the trade there was room for further profit.
Check out the below aswell.
So there we are, a simple strategy in the making.
Let me know your thoughts.
Thanks.
Sean
Just though I'd show you my breakout trading strategy. It could'nt be any more simple, yet it works and the risk:reward ratio can be brilliant!
It's based on breakout of established ranges. Were looking for a trend line to have been tested at least 2 times, however the more times the better.
We're not going to bother with technical indicators, they'll just put doubt in your mind and cloud your judgement.
So what we want is a good established channel, as aforementioned preferably one thats been tested at least twice.
Were then going to follow price as it tests the support/ resistance lines. We'll keep it simple and boring and use a good old line chart; easy to read!
Once price has broken out of the established range we'll wait for it to close on the breakout. We're using a 15 minute chart as it gives a more reliable confirmation signal than the 10 or 5 minute. Plus I get tired of continually staring at charts, it really is'nt that fun!
So once price has broken out, we simply wait for the 'drawback'. You can see this highlighted on the chart. This is basically where price has doubts about its new found ground and wonders whether he preferred the old life in the channel.
This also gives us a chance to enter at a better price.
So we enter towards the end of the 15 period, or on the close of that period, knowing that the likelihood of the price drawing back to the channel is minimal. We set out our profit target for roughly the width of the previous channel. We set our stops as just inside the channel to give it room to breath if it does drawbackand test the level.
As can be seen from the above attachment, the trade worked to plan. I closed this trade as my targets had been met however as you can see if I had off stayed in the trade there was room for further profit.
Check out the below aswell.
So there we are, a simple strategy in the making.
Let me know your thoughts.
Thanks.
Sean
