4H Box Breakout
I've seen breakout strategies for daily and weekly. I've never seen one like the one i'm about to present.
DRAW a box connecting the high of the first 4hr candle(00:00) of the week with the low along with a buffer of 20 pips on each side.
The week starts at the open of the Australian session.
If I had a penny for every time someone has asked which candle it is..i wouldn't need to trade forex to make money. For the next person who is going to ask, follow these instructions.
Download an FXDD platform. Press Ctrl+y on a 4hr chart. Lines will magically pop up and at the start of every week the first 4hr candle should form on the line. This is the candle you use for the High and Low.
Box Forming Times:
GMT- 21:00 to 01:00
EDT - 17:00 to 21:00
FXDD time - 00:00 to 04:00
Use Time zone conversion to find out your specific time.
DO NOT ask when the bar forms and when it closes as its been answered MULTIPLE times. I post every week when the bar closes. If you're not willing to go through the thread or wait one week for my post on when the bar closes than this system isn't for you.
I'm sorry, but it's just gotten to a point where people ask every time.
Some brokers begin operating an hour earlier then FXDD or later. If you first 4Hr bar closes at 00:00 GMT, then that's not the right candle. The best thing to do is to download an FXDD demo platform and use that as reference.
- Add a buffer of 10-20 pips on each end of candle
- Buy on upper break of weekly box (including buffer+spread)
- Sell on lower break of weekly box (including buffer)
SL - other side of Box
TP1 - 1x box size
TP2 - 2x box size
TP3 - 3x box size
TP4 - 4x box size
This system works on many JPY pairs.
**GBP/JPY is the best pair.
May work on other pairs, testing is required however.
I like to use 3x-4x box size as TP.
I take don't profits at 1x size of box because larger reward is key.
I move stop to BE after 1x has been hit.
Risk Management (to find out your position size)
(Account Balance * Risk percent)/Stoploss = mini lot size
- 30 mins a week
- no worrying about charts filled with indicators
- higher reward than risk on EACH trade
- easy to back test
Q&A (thanks to fxann)
Indicators below, thanks to fx2248 for your help.
Feedback would be great from all you FX experts and GOOD LUCK!
1 Box 4 A(2).ex4
1 Box 4 B(2).ex4
What have been your results? Trading live?
Only discovered this strategy at the end of Dec last year. Trading live since then.
Average = 274 pips per week
If you take a glance at a chart with lines separating the weeks then u'll see that with GBP/JPY the trends are great.
Man, this must be my lucky day. I found a thread earlier I like on the 1 hour chart but i like this one even better as it's a weekly chart with no indicators. The weekly chart is great for me because I work a full time job from 8:00am-4:30pm PST but I also don't want to be feeling like I have to always be watching my charts. I will look into this tonight for sure when I get home.
And yes, this may be great because g/j trends very strongly.
Since different brokers use different start times, what time and day are you using for your trdes?
Yes, I totally agree with you. That's exactly what I need to do. Place the orders every week and let them be.
Should the orders be placed exactly at the high and low from the first 4hr candle of the week or is there a certain amount of pips above/below where the orders should be placed?
Also, each week, there will be new order levels so I know any unfilled orders from the previous week will have to be cancelled. Lets say for instance the long orders get triggered first, do you cancel the short orders or keep them in play just in case the market heads in the opposite direction before the end of the week?
Also, do you keep triggered orders open over the weekend or do you try and close them before your broker closes on Friday?
I generally place the buy order with a buffer of 10 pips + spread.
The Sell is just 10 pips below the box.
If orders have not been triggered by SL or TP by the end of the week please do so manually.
I do keep both Long and Short orders even if one of them has hit the TP
** But take this into account. Since the start of the year GBP/JPY has had a range of 785 pips per week on average. With that said if your TP has hit and the pair has already moved up or down by a large amount of pips AND you know that the TP on the other side will most likely not be hit. Cancel your order. This is something that required some practice but it is very easy once you get use to it.
Thank for sharing this system. Would you mind posting this weeks chart with the HIgh and Low.
just a couple of questions, do you put a order above and below the square? or do you clasify a break of the square(as your instructions say) when the candle closses past the box. last of all, would there be a indicator out there to draw a box for mt4 platform. cheers
EDIT: oops first question already answered just above. ignore the first question.
[quote=would there be a indicator out there to draw a box for mt4 platform. cheers[/quote]
Unfortunately i dont have the slightest clue with programming indicators.
Anyone know how to make an indicator for this system with a 10 pip buffer?
Hello and thanks for sharing this system.
My Broker uses a Sunday candle and it appears yours does not?
My question is... should I just dismiss the Sunday candle period and start with 00:00? (which also is the Asian session opening - at least it is on my chart)
Thanks in advance!
IF TP 1 is triggered do you move the SL to break even?
I haven't had time to review the thread yet, but I saw someone asked for a box. Attached is one that could possible be used. You can set the start and stop time, and pip buffer. Play with the offset to match it to your broker's time.
Instead of placing a box on one H4 candle, it's much easier to see if its placed on the first 4 candles of H1, or you can use an m30 chart, etc -- it's all the same as long as it covers the first 4 hours -- but I haven't seen the whole thread yet, so don't know if there's a specific reason.
I don't have the code for this, but if someone else does it probably could be modified to show all the tps and sls.
I was thinking of trying the same thing!
hi this system sounds cool. just to confirm, so you only place 1 trade per week? or will you, say after you long, it reaches your tp, then there are signs of reversal and it hit ur lower point, will you short again?
shucks i m late for one day else i could have used this system!
The box I posted above will place a box at the start of each day, which is too many for this method. You could take an H4 chart and do what Palmer did above, then highlight the weekly lines like this pic. And then place the box on, switch to H1, and then just play the boxes that are against the red lines.
Use the inputs to set how many boxes you want to see and the buffer. This pic has a 10 pip buffer on each side. For 5 digit brokers use 100 for 10 pips.
I may have another more flexible box, but have to search for it.
I just had something pop in my mind. What about having a trailing stop that is the same size of the distance of the box. So, say the distance from the high to the low of the box is 80 pips, why not put a trailing stop of 80 pips on your orders so as price moves so does your stop loss. So if price reaches +160 your stop loss will have automatically locked in +80 for you. Just a suggestion.
** STUDY AVERAGE TRUE RANGE for weekly and you'll see when to not go for the other order if one TP has already been hit and when its okay.
Enough said for me. I will stick to just placing the orders and letting them run and see what happens. I see that todays short is up +298 pips according to my broker (that's from the entry point at 149.48)
How does one interpret ATR? I've never used it before.
*So if you are looking at weekly bars, and the ATR(14) is reading out 6.95 on GBP/JPY, that means that over the past 14 bars, the average size of each bar or average weekly movement is 695 pips.
There are some differences with different pairs.
GBP/JPY - 5.76 = 576 pips
GBP/USD - 0.0492 = 492 pips
EUR/USD - 0.0418 = 418 pips
I think an EA to back test and forward test several currency would be beneficial.
Man's Best Friend
Thanks for sharing your system ! I also work a day J-O-B and have limited time to look at charts as well, so this system will work out well for me . I have seen similar systems posted , but they are for break-outs on the London open , which is 2am here so that doesnt work . After studying the market for years , I have come full circle and discovered that " simplicity works " . Again, thanks for sharing your system on this thread .
Winning Percentage since Dec?
Hello Ace! Could you give us an idea what your winning percentage has been sincce Dec? I am looking forward to testing this system. Thank you!
Do you have only two trades/week for a pair?
For example, after the end of the H4 candle, you place long and short.
If long is triggered and say, TP is hit or SL is hit and the trade is closed. Then, price comes down/goes up to the top of the box. At this point, do you open another long trade or is the long trade setup for the week is over as the TP/SL was hit.
Short order would be pending in this case and we would wait for it to be triggered. My question concerns about the entering long trade again at top of the box again.
I really like your trading style. I am very glad you are from pakistan. I live in Islamabad and hope to meet you if possible.
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