SSBO - The Stairstep Breakout System
Sept 8th, 2013: A message from Forexhard to all newcomers to this thread: This thread was active for 22 months, from July 1st, 2011 onwards, and it was hands-down one of the busiest and most visited trading system teaching threads here at the Factory. After that many months, it became clear that I, as the OP, could not continue to dedicate the same amount of time to monitoring this thread as I had, so it was eventually closed down and moved to the Recycle Bin, where you now find it. It was not moved here because SSBO was found to be in any way defective. Just the opposite, in fact: SSBO is literally the only system I have seen where no one has ever complained about losing money with it; as well as the only system where the rules for it at the end are still exactly as they were at the start. I still trade this system myself, and, judging by the mail I receive, so do thousands of traders all over the world. SSBO has changed many lives, and I am grateful to have played my part.
For all intents and purposes this thread is dead. Which simply means that almost no one posts here any more, even though we do still get about 1000 hits per day, even though we've been in here about 4 months now. And posting is still allowed, just don't expect a quick answer.
The information here is still as relevant as ever, and if used properly it can still change your life too. Like you will hear me say hundreds of times throughout the thread, it's so easy it's hard. Trading is actually very easy once you know how. SSBO will teach you what to do. The SSBO template is laid out as clearly as I can make it in the paragraphs just below this one. The rest is up to you. Good luck!
If you are like most new visitors, you have stumbled onto our little corner of the web after encountering the usual number of trading systems that looked great at the outset, but after a dozen or so pages you suddenly realized that it no longer resembled the system offered back on Page #1. And then you probably asked yourself (as we all have), why was the system even offered in the first place if it could be so easily twisted out of shape in less than a week. And then there are the systems where the thread starter tries to trick you into leaving the Factory (Hey, let's start a Skype group!) after a few weeks to join them in a "private" club by "invitation only" where you can get special "insider" trading tips. For a price, of course. And don't even get me started on the threads that change indicators so fast and so frequently that you're saving a new template 10 times a day. And how about my personal favorite, where the OP starts off by saying they have traded "this way" for months or even years with a high degree of success, but then after a few weeks into the thread they sign off, saying they have found another system that works even better. WTF???
Are you finally fed up yet? You're not alone. The disillusionment you are feeling by now is perfectly understandable, and you are not the first person to wonder if a practical thread exists that teaches real market fundamentals that won't change with the wind, or whether it's possible to find an honest and altruistic mentor with no hidden agenda.
It does exist. You have just found it. Welcome to Stairstep Breakouts, or SSBO.
The underlying concept behind SSBO is so simple it's hard: Wait until the market is doing "nothing" (relatively speaking) before setting out your plan of action. In other words: 1) When the market is active we do nothing; 2) When the market does nothing, this is when we plan for our next trade.
For SSBO, this "nothing" comes in the form of Consolidation Zones, or CZ's.
But in order to trade with CZ's, you must first learn to identify and classify them. The purpose of this thread is to teach you how to correctly identify only the very best CZ's, and then how best to exploit them.
WORDS TO LIVE BY:
#1: In order to fully understand this system it is essential that you spend one full week experimenting with the trading details found in the first 8 posts. You must become proficient at picking out these types of Consolidation Zones (CZ's) regardless of the pair or the Time Frame by simple visual confirmation alone -- aka, Naked Trading. Posts 1-8 teach you how to do exactly that. This part truly is the essence of Stairsteps, so skipping over this phase of your self-training is only going to cause you a lot of grief later on down the line. So please, no shortcuts. Stay with the program and get this part down solid before continuing past the first couple of pages. If you find yourself on Page #10 before committing to this week of practice, you have gone too far. Stop, come back, and put in the week of practice before going any further. This is your primary confidence building step. It starts right now. If you pass it over, then you can't expect to have the required confidence for what comes after. Fully 90% of all belligerent comments and noob questions (and failed trade examples) found in this thread come from people who skipped over this part and just read through it without actually putting in the suggested week of practice. Conversely, the successful workers of this system, the folks that are the friendliest and most confident and most productive participants we have, are the ones that did. In other words, if you skip this week of self-training do not plan on becoming a successful trader; you will probably be a SSBO/FOREX failure, just another losing statistic, part of the legendary 95%. Never say I didn't warn you.
#2: This thread was started as a naked trading system. See paragraph #1. We do have a custom indicator now, but we didn't start out with one. After nearly 20 months we still have traders working off of naked charts with hand-drawn CZ's, so using the custom indi is certainly not a requirement. If you like it, use it. If you don't, then don't. It's use is completely optional; pips have been made either way. But if you decide to include the indicator as part of your Stairsteps trading, then you are expected to learn how to use it with absolute minimal outside assistance. Demanding that other members or myself provide you with our own custom settings or templates for the indi is a sure way of getting yourself banned from the thread. NOTE: The custom indicator does not replace the Naked Trading excercise from paragraph #1. The correct method is to add the indicator to your charts only after having mastered these steps, not before.
#3: This thread is unlike most every other system thread offered here at the Forex Factory in one very important regard: I am not teaching questionable theory here. SSBO is no fishing expedition. This is a proven system that I have used with a very high degree of success for the last 5 years. It does not require refining. It does not require extra indicators or filters. It is being presented as a time-tested and fully mature system of trading the Forex market. The proof is that after 20 months and over 1.45 million hits, no major details about the system have been altered, save for the addition of our custom indicator and the necessary adjustments this has brought into the thread. Other than that, the core system of Stairsteps remains completely unchanged, a fact I am extremely proud of. Not because I am adverse to change, but because so far none has been needed.
#4: I expect anyone who participates in the thread to do so only after reading it all the way through. Save your questions and comments until the end. It may take a couple of weeks to read all of it at a reasonable speed that allows for good comprehension and retention (in addition to the week of testing from para.#1), but it's worth the effort. Consider it an investment in your future. Jumping to the end and expecting special treatment is another sure way of getting banned. When you're finally ready to participate and add to the general discussion, you will be expected to post pics of your charts and your trades. Note: Some senior SSBO members report that they have read through the entire thread 3 or more times, and still come away with new revelations. There are hints and notes everywhere. Half the fun is digging them out on your own. So do what the experts do, and plan to read through more than once over the next few weeks.
#5: There is no single post or page that says it all. You will need to read the entire thread to get the maximum effect. The regular members (and I) can pick out fakers a mile away. Please don't insult our intelligence. Scammers, trolls, broker moles, time wasters and trouble makers are not welcome here. You will be banned sooner or later with absolutely no regret on my part. On the other hand, serious students that aren't afraid of putting in the time, effort, and due diligence are always welcome. Do yourself a favor and treat it like a marathon to get the full effect. Not only will it improve your trading, but you will earn the respect of your fellow Stairstep traders too. We've all passed throught the fire already and have come out tempered on the other end, and we welcome your company!
#6: As you read over the thread you will notice that I do not provide trading signals, nor do I provide indicator templates. I do not post pics of on-going live trades, but I do post pics of recently closed trades. In other words, I do not make it possible for members to follow my trades while they are still live. There are two main reasons for withholding this type of information: First, being spoon-fed keeps you weak, and it places the mentor above you and keeps him there forever. A real mentor wishes that his students will become as strong as he is, or even stronger. A real mentor never wishes to be the center of attention forever, just long enough to get the student on their feet and going strong. So you should expect to see a lot of "tough love" in this thread, and not a whole lot of spoon feeding. Noobs with questions already covered in the thread will be ignored; persistent noobs looking for a handout will be instructed to go back to Page One and try again. Noobs that don't get the first 2 hints usually don't get to stick around. Second, is that by providing such detailed information in a public forum, some poor soul could get the impression that I was suggesting that everyone reading my posts should follow suit. But what happens if that trade fails? Am I now responsible for everyone else's losses too? There have indeed been other Forex Factory mentors sued over losses in just this way. I don't intend to become a member of their club. So yes, out of an over-abundance of caution there are questions I simply will not answer. Intelligent folks will understand this concept and respect my wishes. Those less intelligent will ignore my wishes and continually ask for my private trading details. Of the 2, guess which ones get banned and which ones don't.
A: July 1st, 2012, marks our 1-year anniversary! We are now on page 185, with 2770 posts, 678,650 views, and 192 votes. The Consolidations PDF in post #1 has been downloaded 14,326 times.
B: Due to a sudden rush of noob posters after our anniversary, I have been forced to post this warning on page 185: www.forexfactory.com/showthread.php?p=5811021#post581102 1
C: Aug 10th, 2012: Thanks to Xux99 we now have the new and improved SSBO indicator (below), with a fully automated EA on the way.
D: Aug 30th, 2012: After 1300 downloads of the Aug 10th edition, Xux99 has upgraded the custom indicator to Final Edition.
E: Jan 1st, 2013: We have passed the 18-month mark. The system remains unchanged -- we still use the same rules and guidelines as we did a year and a half ago -- which must be some kind of Forex Factory record.
F: Feb 21st, 2013: This link contains the latest version of our custom indicator: www.forexfactory.com/showthread.php?p=6463289#post646328 9 [post #5552 from Feb 21, 2013] The indicator here in the OP is an older version, but I am leaving it in place for comparison.
G: May 2nd, 2013: I have asked that this thread be moved to the Recycle Bin. The system works as good as ever, I just don't have the time to maintain the thread indefinitely. 30 hours per week for 2 years is enough. For anyone just coming in, just follow the instructions of this 1st post to the letter and you can't go wrong. After 7 years in the business, SSBO is still the most reliable trading system I have ever seen, and thousands of traders all around the world agree with me.
H: Aug 8th, 2013:To the newbies that keep trying to entice me back into the thread, I say: I was happy to give my time at no charge to this teaching thread for more than 2 years, even though it drastically cut into my private life and trading time. It was a choice I made, and I stuck with it according to the plan that I had laid out for myself even though it ended up costing me thousands of lost pips each year. But that time is over. The thread is closed, and I am back to full time trading and mentoring. At this point, my private students, my hobbies, and my trading are back to getting my full attention.
It's not easy becoming one of my students. Many more applicants over the years have been rejected than have ever been accepted. But for anyone wishing to be considered as a private mentee, I can be reached through my Forex website mentioned in my FF profile.
As far as the SSBO system goes, we are closing shop here as literally the only system known to exist at the Forex Factory where the rules have remained unchanged throughout the life of the thread. And that, my friends, is really saying something! The SSBO self-training template is spelled out in the very first post, right above where you are now reading. Your success will be determined by how well you follow the sage advice given there (and throughout the thread), and you can only expect to get out of it what you put in. Good bye and good luck!
The original first post:
Some traders swear by man-made indicators. Some swear by technicals and analysis. Today I will be presenting one of the ways I trade using breakouts based only on pure price action and simple hand drawn breakout boxes.
This method is so simple it's hard. Most traders overlook this style of trading not because it is ineffective, but because it just isn't as "sexy" as a method that employs lots of colorful lines and graphs and special lingo and complicated algorithms. This system may not be sexy (it isn't), but it is highly effective -- for me. YMMV.
Let's get right to it.
Pic #1 is highlighting the type of consolidation zones we are looking for. There is no hard and fast rule here. Simply "eyeball" the chart and pick out these types of zones, and then cover them with a rectangle from your MT4 tool bar. Later, this rectangle will be a uniform height, but for now just draw the boxes free-hand and pick out as many of these zones as you can.
This system will work for any pair on any TF. But for those who wish to follow me I am showing a G/U M15 chart from this week (ending July 1).