I'd like to share my strategy for entry and record all qualified trades I take or miss here.
It's a trend following strategy and I call it S123(simple 123) Breakout strategy. Some of you may be familiar with 123 reversal pattern which inspaires me but is a bit different from the one here. My S123 pattern appears at the top/bottom of a trend and in the trend as well. Le's see it in a chart (XAUUSD H1 11/10/2018)
Point 1 - Start of the main wave
Point 2 - End of the main wave
Point 3 - Low of the correction wave if the main wave is up (high if the main wave is down）
Main wave (1-2) confirms the trend and correction wave (2-3) gives a pullback. We simply open a trade when price breaks point 2 and put the SL below/above point 3.
It sounds very easy, doesn't it? However, there will be too many fake signals if we only use the naked chart. I use two moving average lines to confirm an entry.
The red line (50SMA) shows the trend of the current time frame;
The black line (15EMA) shows not only the trend of lower time frame but also potential support/resistance to confirm the momentum when breakout appears.
With two MA lines we can confirm a S123 pattern and enter a trade with confidence. Here is another short trade example (EURJPY H1 21/12/2018).
Though S123 Breakout is powerful, but it's only an entry stretagy, you have to combine it with your own market analysis (trend/SR/candlestick/fundamental/etc.). Personally I would confirms some potential pairs everyday before waiting/looking for a S123 pattern. My list of time frames is Week-Day-H4-H1-M15. Normally I take swing trade and intraday trade following this order.
Swing trade
Day (candlestick) - H4 (trend) - H1 (S123 pattern)
Intraday trade
Day (candlestick) - H4 (candlestick) - H1 (trend) - M15 (S123 pattern)
You can even use S123 Breakout on higher time frame if you want. An excellent example is XAUUSD H4 19/06/2018 (Week-Day-H4).
Here are some rules and recommendations:
1. S123 Breakout is an entry strategy. Do not trade only based on its signal;
2. Try it on demo or backtest before using real money account;
3. All roads lead to Rome. If you're not a fan of trend-following or breakout strategy please simply close this thread;
4. I hope this thread to be a trading gallery for S123 Breakout. You're most welcome to share your own S123 Breakout trades here;
5. Questions and recommendations are welcome but please make it clearly and specific.
Wish everyone a profitable year of 2019!
It's a trend following strategy and I call it S123(simple 123) Breakout strategy. Some of you may be familiar with 123 reversal pattern which inspaires me but is a bit different from the one here. My S123 pattern appears at the top/bottom of a trend and in the trend as well. Le's see it in a chart (XAUUSD H1 11/10/2018)
Point 1 - Start of the main wave
Point 2 - End of the main wave
Point 3 - Low of the correction wave if the main wave is up (high if the main wave is down）
Main wave (1-2) confirms the trend and correction wave (2-3) gives a pullback. We simply open a trade when price breaks point 2 and put the SL below/above point 3.
It sounds very easy, doesn't it? However, there will be too many fake signals if we only use the naked chart. I use two moving average lines to confirm an entry.
The red line (50SMA) shows the trend of the current time frame;
The black line (15EMA) shows not only the trend of lower time frame but also potential support/resistance to confirm the momentum when breakout appears.
With two MA lines we can confirm a S123 pattern and enter a trade with confidence. Here is another short trade example (EURJPY H1 21/12/2018).
Though S123 Breakout is powerful, but it's only an entry stretagy, you have to combine it with your own market analysis (trend/SR/candlestick/fundamental/etc.). Personally I would confirms some potential pairs everyday before waiting/looking for a S123 pattern. My list of time frames is Week-Day-H4-H1-M15. Normally I take swing trade and intraday trade following this order.
Swing trade
Day (candlestick) - H4 (trend) - H1 (S123 pattern)
Intraday trade
Day (candlestick) - H4 (candlestick) - H1 (trend) - M15 (S123 pattern)
You can even use S123 Breakout on higher time frame if you want. An excellent example is XAUUSD H4 19/06/2018 (Week-Day-H4).
Here are some rules and recommendations:
1. S123 Breakout is an entry strategy. Do not trade only based on its signal;
2. Try it on demo or backtest before using real money account;
3. All roads lead to Rome. If you're not a fan of trend-following or breakout strategy please simply close this thread;
4. I hope this thread to be a trading gallery for S123 Breakout. You're most welcome to share your own S123 Breakout trades here;
5. Questions and recommendations are welcome but please make it clearly and specific.
Wish everyone a profitable year of 2019!
