استرتيجيه London Breakout

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استرتيجيه London Breakout

نقوم بفتح شارت الربع ساعه للباوند نقوم بوضع خط طولي علي توقيت الساعه 4 بتوقيت جرينتش ( احسب فارق التوقيت للسيرفر الخاص بالبرنامج المستعمل) نقوم بوضع خط طولي علي توقيت الساعه 6 بتوقيت جرينتش

( احسب فارق التوقيت للسيرفر الخاص بالبرنامج المستعمل) نقوم بوضع خط عرضي كمقاومه علي قمم الشموع ما بين المنطق نقوم بوضع خط عرضي كدعم علي قيعان الشموع ما بين المنطقه
اضافه مؤشر الموفنج اكسبوننشال 89

شروط الدخول

• الشراء :

بعد الساعه السادسه + وجود المتوسط اسفل البوكس الخاص بالفتره الزمنيه يتم وضع امر باي استوب اعلي خط المقاومه الخاص بالقمم ب خمس نقاط الاستوب لوس 15 بيب البروفت 75 نقطه ( بعد تحقيق 20 نقطه نحرك الاستوب الي منطقه الدخول )

• البيع :

بعد الساعه السادسه + وجود المتوسط اعلي البوكس الخاص بالفتره الزمنيه يتم وضع امر سل استوب اسفل خط الدعك الخاص بالقيعان ب خمس نقاط الاستوب لوس 15 بيب البروفت 75 نقطه ( بعد تحقيق 20 نقطه نحرك الاستوب الي منطقه الدخول )

• عدم الدخول :

في حال كان المتوسط داخل البوكس الخاص بالاسترتيجيه

تصنيف وسطاء الفوركس 2020:
  • FinMaxFX
    FinMaxFX

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London Breakout Strategy

The London Breakout Strategy falls under the category of Open Range Breakout as developed by Toby Crabel. In this article we’ll look at some results with regards to this strategy, as well different ways of trading it.

Let’s start out with the notion of Open Range Breakout. The key concept behind this strategy is that the range set at the start of the day sets a neutral zone for the rest of the day. If price moves either side of this range it is a strong indication that price will want to continue in that direction.

Here is a diagrammatic representation of this setup:

Example of Open Range Breakout

The shaded region indicates the initial range of the market open. The justification for this type of trading is based on following observation: the frequency of highs and lows for the day tend to be highest during the opening range.

There is a caveat to this observation: this is equally true for random markets! If you model the markets with a Geometric Brownian Motion you will find that the highs and lows tend to cluster at the start and the end of the day. It’s the nature of random movement to cluster its high and low points at the start and the end of the time period. You need to control for this clustering of highs and lows to determine if the market you’re considering shows abnormally high concentrations of highs and lows at the start of the trading period. For currencies, it turns out that we don’t need to take this into consideration.

So if we are correct in assuming that highs and lows tend to cluster around the opening of the day, it means that we stand a good chance of capturing a trend if we somehow get on-board in the right direction.

That is the point of the Open Range Breakout (ORB).

Toby Crabel made this approach famous and Mark Fisher used it as the cornerstone of his ABC trading approach which is outlined in “The Logical Trader.” You can find a link to this book in the Resource section of my site.

So what about currencies? They trade 24 hours a day, and close only for weekends. Let’s have a look at the clustering of highs and lows during a trading day.

High Low Clustering During Trading Day

This chart plots the frequency of highs and lows since 2001 for EURUSD, where time is in GMT. As we expected we have the artificial spikes at 00:00 GMT. Much more interesting is the clustering around 7am GMT and 1pm GMT. These coincide with the London opening and New York opening times.

Note that this is a different measure from volatility. Usual volatility measures or tick-volume measures also indicate a flurry of activity around those times. However, the chart above shows the number of daily highs and lows for every hour of the day since 2001. The fact that they coincide is not a necessity! But it meshes nicely with the picture we expect.

So our approach to ORB for currency markets is to define the opening time as 7pm for the London Opening. We can repeat the exercise for the New York opening, however, for a variety of reasons the London Opening is more profitable, so in this article we’ll just focus on that.

We can then take a specific time span to monitor the range (which would be the pink shaded region in the figure above), and use stop orders to trade the breakout either side of the range. For this article we’ll choose a one hour time span. So we monitor the markets from 7am to 8am and the highs and lows of that price range determine the levels of the buy and sell stop orders. We will use protective stops on the opposite sides of the range.

Here are a couple of examples for EURUSD. The first one shows a really nice break in one direction which happened on the 26 th February, 2020, and was driven by the preliminary USD GDP numbers which came in much better than expected.

Of course for every beautiful picture like that you also have a choppy day. For instance the 8 th January 2020 was a day that got chopped by the Non-Farm Payroll releases.

So armed with this strategy, let’s backtest it! The data used is the minutely free data from Forexite as published on the ForexTester site, which spans the range 2001 until the end of 2020. You can find the link on my Resource page.

London Breakout Backtest

The performance is steady. However, the P&L flat-lined from the middle of 2020 to the second half of 2020. Why?

One thing did happen in 2020 which lasted through to 2020: fallow volatility. EURUSD at one point in the summer of 2020 was only moving 40 pips a day.

This observation is key to breakout systems. Breakout systems don’t make money without movement. Movement is measured by volatility, another way for saying that markets swing. In markets that don’t move any kind of momentum strategy will be chopped to pieces.

It turns out that we can make this statement more precise for the EURUSD strategy above. In markets where the average daily range is less than 100 pips, we can expect to be chopped to pieces by swings either side of the opening range.

How does that help us? Well, for starters volatility regimes are persistent. There has been a lot of study with regards to this topic, and a lot of evidence points to the fact that high volatility days are followed by high volatility days and low volatility days are followed by low volatility days. So if we can find any catalyst that will activate the markets, that is the perfect time to run this strategy.

Another interesting observation: 2020 to 2020 was also a bad year for trend-following funds. Momentum seems to have ebbed away on every time scale, form intraday strategies such as this one, to trend-following strategies with holding periods of weeks and months.

This approach is purely pattern based, and some of you will naturally ask, why? Why should it work? There are some reasons, mostly anecdotal, from voice-traders working at Banks. The opening time of the markets is the period when most big orders come through (in terms of notional size: billions). It’s the voice-trader’s job to execute. He won’t do that in one clip. He’ll slice the order and job with the aim of filling the client on average at a decent price, but also my being opportunistic on the individual slices so that he can make a profit for his book. If all of a sudden price runs out of the morning range, he is left with an order that he has to chase, and he can’t afford to wait for price to come back. His order execution becomes more aggressive, and that will push price further out, creating the break in the markets.

As always, such anecdotal evidence needs to be taken with a grain of salt: it’s very difficult to test. On the other hand the fact that we found a market factor that correlates with strategy performance gives us a better handle on why we should currently trust the strategy, and how to keep monitoring it for ongoing performance.

If you want to delve deeper into breakout strategies across different time horizons, then have a look at my book on Kindle: Forex Breakout Strategies.

If you liked this article, then follow me on Twitter and subscribe to my newsletter below.

Breakout indicator Metatrader 4, best strategy

by Azzam · Published January 22, 2020 · Updated May 8, 2020

Breakout indicator is good tool trading to help find key level strategies

In forex trading, traders use the trend following and breakout strategies, both of which have the same goal, getting profit.

The following trend strategy is a strategy that opens a position in the direction of the major trend direction.

Strategy breakouts rely on conditions where the support and resistance zones are no longer valid in maintaining their zones.

Breakout trading will open a position in the break line zone in a certain area.

The idea is that when a certain zone no longer maintains its price line, it will create a new zone.

The strategy is quite simple, but there are several ways you can use it to find a breakout.

In this article, we will explain some of the best breakout indicators for mt4 and mt5, which we summarize from several sources.

Trading forex, crypto and CFD with TenkoFX

Regulated broker by the International Financial Services Commission (IFSC) of Belize.

Breakout trading explained

Breakout strategy has been many traders who use this strategy to capture profit opportunities from the momentum where the price has broken the key zone, or support and resistance zone.

Utilizing breakouts can provide high-profit opportunities, provided that the breakouts that occur are not fake.

Thus the trader will focus more on the key zone, before deciding to use a breakout strategy.

Even in using this breakout strategy, several indicators can be utilized to find the momentum of the breakout.

There are many different breakout indicators out there, but we will give a few examples.

There are many breakout indicators.

But in general, the breakout strategy is to use support and resistance and also use swing highs and swing lows.

But in its development, there is also a London breakout strategy which is quite popular among traders.

How to use a breakout indicator to find entry points?

Because there are many different types of indicators, of course, this can also lead to differences in how to find entry points in each strategy.

As using price action in finding breakouts.

For example, by using a pin bar, inside a bar, or an outside bar, using an indicator needs to look at the function of the indicator and how the price reacts to the indicator.

Some breakout indicators that are often used by traders are MACD, RSI, and ATR.

But there are also many custom indicators from third parties that also function as strategy breakouts.

Implementing the best profitable strategy must also be supported by brokers who have a clear reputation and experience and regulations.

You can read the broker’s review on this site.

But we recommend that our sponsor TenkoFX who has been established since 2020, has more than 15 years of experience in the financial markets.

Breakout indicator strategy using ATR

ATR stands for Average True Range, this indicator is usually to measure the stop loss distance.

But it turns out this indicator can also be used for strategy breakouts.

It’s just that it doesn’t work alone.

It still needs additional indicators to be able to take advantage of the momentum breakout based on this indicator.

Additional indicators that can be used are EMA with a period of 14 and resistance support to find swing highs and swing lows.

You can use fractals to find this by looking at previous fractal highs and lows.

Here is image example combination ATR, fractal, and EMA

How to attach the ATR breakout indicator

  • Open the Insert menu -> Indicators -> Oscillators -> Average True Range, set “Period” at 14, then click OK.
  • Browse the “Navigator” tab on the left side of the chart. Open the Indicators menu, then search for “Moving Average” and drag the indicator directly in the ATR window.
  • In the Moving Average settings window, the “Apply to” menu setting in option the “Previous Indicator’s Data”.
  • Select Exponential in the “Method” column, and write 14 in the “Period” column and click OK
  • Attach Fractals by opening the Insert menu -> Indicators -> Bill Williams -> Fractals. There is no change in settings for fractals.

How to trade breakout indicator

How to trade breakout is to find a break line point at support and resistance, so to determine the entry you must pay attention to the price is in the zone.

In this ATR breakout using the swing high and swing low of the fractal indicator.

  • The entry method is to look at the crosses between EMA and ATR, if the price is in the resistance zone or swing high, then open buy if the EMA line crosses the ATR from the bottom to up.
  • Conversely for short or sell signals is to see the price is at the swing low level or support zone and use a cross between EMA and ATR if EMA crosses the ATR from above this down is a sell signal.

For stop loss you can use the ATR value or choose to use support and resistance, this will certainly give a different amount of risk.

While your profit target can pay attention to price action or use support and resistance levels from history or use a trailing stop.

Breakout indicator strategy using MACD

MACD is one of the popular indicators that measure price volatility, by looking at a higher histogram meaning that volatility is increasing.

Conversely, a shorter histogram means weakening volatility.

But this indicator is also able to breakout strategy.

How to use MACD as a breakout strategy we need to add a fractal indicator that serves to find support and resistance as a zone in determining entry breakouts.

How to attach an indicator

  • You can find the MACD indicator via Insert – >> Indicator – >> onscillator – >> MACD.
  • And fractal through Insert – >> Indicator – >> Bill Williams – >> Fractal.

You can use this strategy on all timeframes, but the higher the timeframe, the distance of support and resistance from fractals will be wider than using the small timeframe.

You can try using the M15 timeframe for the short term.

How to trade breakout mt4

Sell entry

  • MACD shows below level 0, giving an indication of a downtrend.
  • Fractal shows the price is at the support level.
  • Place sell stop order with 1-2 pip also takes into account the spread, below the fractal low.
  • You can place a stop loss on the swing high from the fractal, or according to the risk that is ready to bear it.
  • A profit target with a risk-reward ratio of at least 1: 1 or greater.

Buy entry

  • MACD shows above level 0, giving an indication of an uptrend.
  • Fractal shows the price is at the resistance level.
  • Place buy stop order with 1-2 pip also takes into account the spread, above the fractal high.
  • You can place a stop loss on the swing low from the fractal, or according to the risk that is ready to bear it.
  • A profit target with a risk-reward ratio of at least 1: 1 or greater.

As an additional note, if you find a fractal below the previous fractal in the uptrend, there is no trade.

Conversely, if you find a fractal above the previous fractal in a downtrend, then no trade.

This breakout strategy based MACD and fractal most working in the trending market, so it will better avoid the ranging market.

London breakout strategy

London breakout strategy is already very well known, which utilizes the surging movement in the London session.

Before the London session opened there was already a market in the Asian session that was already underway.

Usually, the highest market activity is seen in the European session, so with this strategy, we will try to look for opportunities by sticking to the price range during the Asian session.

Actually you don’t need to use any indicators to run this London Breakout forex trading strategy.

How to trade

  • Open the graph on the H1 timeframe, you can trade on major pair, EUR/USD, GBP/USD, EUR/JPY.
  • Create a box on the chart with the last three candlesticks that appear before the London session begins.
  • Based on the “box” above, draw two horizontal lines, each of which functions as support and resistance. This means you have to draw one horizontal line on the top side of the “box” and another horizontal line on the bottom side of the “box”.
  • Place a Stop Order Buy Stop is about 5 pips above the resistance, place SL at Sell Stop level.
  • Sell ​​Stop is about 5 pips below the support, place SL at Buy Stop level.
  • If one of the Stop Orders is executed, you must immediately cancel one another order.

This means that if a Buy Stop is executed then immediately cancel the Sell Stop order and vice versa.

To use the above strategy you need to know when the Asian session ends, you can look for it on the internet market hour indicator.

This strategy is very simple but powerful, but there are weaknesses in this strategy, especially the possibility of being caught in bull and bear traps.

Because this strategy is very popular, then some people develop an indicator called the London breakout MetaTrader 4 indicator.

Breakout indicator trading support and resistance

Breakout with support and resistance is the basis of a breakout strategy, besides using swing highs and swing lows.

To use this strategy you need to understand the concepts of support and resistance and draw on a chart.

You can use horizontal lines to mark support and resistance levels.

Breakout support and resistance strategies utilize key levels when the price broken line occurs at that level.

The idea is that when prices cross the support and resistance levels, it will become a new level of support and resistance.

The picture above is the USDJPY pair at the H1 timeframe.

After finding support and resistance levels we can place pending buy stop and sell stop orders at these key levels.

For stop-loss we can also place at this key level, if one pending order is active, then another pending order is canceled.

Target profit ideally using the ATR indicator, or you can also choose a risk-reward ratio of 1: 1

But if you are confused about how to find support and resistance, another way is to use the help of support and resistance indicators.

Many types of indicators are created, but because of the different programmers also will be different results in finding support and resistance levels.

You can try using the support and resistance indicators here.

But if you have enough money you can buy at market mql5, just need to use the search box to find support resistance indicator.

Final thought

The breakout strategy is one of the ways traders try to capture the opportunities available in the forex market or the crypto market, while breakout indicator as help tool among traders.

This strategy will be better if applied to the trending market conditions after the sideways phase ends.

Where the movement has begun to be high, this strategy can provide profits with high probability.

In practice to lower risk, you can choose a strategy, for example, London breakout strategy, or support and resistance breakout.

Focus on implementing the strategy so that you don’t blindly enter the entry point, enter only when conditions are met, and avoid when conditions are not met.

Don’t forget to always keep money management, this is the key to the success of professional traders.

Thank you for reading, if you like an article, please share via your social media.

تصنيف وسطاء الفوركس 2020:
  • FinMaxFX
    FinMaxFX

    أفضل وسيط فوركس لعام 2020!
    الخيار الأمثل للمبتدئين!
    تدريب مجاني!
    حساب تجريبي مجاني!
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