Morning hours breakout

Hey there and a good new year 2016!

In this journal I want to introduce and forward test a dead simple breakout approach where I take the 30min candle from 9:00-9:30 (CET => GMT+1) and place stop buy and stop sell orders above and below. That's it. Traded pairs are EUR/USD and GBP/JPY...

Alright, here are the rules in a more readable form:

 

1. Traded pairs: EUR/USD and GBP/JPY
2. Take the 30m candle from 9:00-9:30 (CET => GMT+1) and place a stop buy order above that candle and a stop sell order below
3. SL is 80% of the size of the candle
4. TP is 100% of the size of the candle
5. Order duration is 1 day
6. If one target is reached, clear the opposite order

The idea behind this is to use the usual volatility in the first hours of the european trading session.

There is another part of this approach, the position size. I use some progression here. I start with a risk of 0.25% per trade. Wenn a trade runs into a SL I increase that to 0.5% for the next trade, then 0.75%, 1.00% and so on, capped at 2.5% per trade. In case a trade runs into its TP, I lower the position size for the next trade again bei 0.25%.

So: Trade runs into SL: Increase next trade risk by 0.25% (capped at 2.5%)
Trade runs into TP: Decrease next trade risk by 0.25%

Cheers!

Hi All.
Rules of trade :
1) At exactly 8am UK Time take the price of GBP/USD .
2) Place a Buy stop at price +40 pips, stop loss 75 pips, take profit 240 pips, trailing stop 60 pips.
3) Place a sell stop at price -40 pips, stop loss 75 pips, take profit 240 pips, trailing stop 60 pips.
4) If trade entry level is hit, delete second trade order.
5) Close all trades at 7pm UK time

Hey Samand, I don't get actually what you want to tell me with your posting?

so if no target (TP) is hit, you can lose 4 trades, right?

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That's true.

thanks Xaron
was your back testing successful?
good luck

Yes yonnie. Backtesting shows some average results over the last years.

First week ended with a plus. There will be weeks, even months which can end negative, but I think in the long run this pretty basic system will pay off.

Have a nice weekend!

was always interested in reading about your trading according to "bird watching in lion country"
still your main trading system?
how did it go last year?
I trade in a similar way on the Nasdaq100 cfd`s/futures, but not in only 1 direction.
am still fine tuning the system.
is easy to do with trading only 1 instrument.

now about this breakout system.
negative weeks/months in ranging periods with low volatility?

Hi all, this will be continued here: http://www.forexfactory.com/showthread.php?t=578503

Regarding BWILC I start another thread about it!