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Breakout + Spread!! Sure!!!

  • #721
  • Jan 8, 2008 4:16am Jan 8, 2008 4:16am
Quoting madscalp
Thanks WHTenn,
I understood but the candle in the terminal line of orange box is the hourly candle 9:00-10:00 and the candle circled in yellow is the hourly candle 10:00-11:00.
OK ?
So, we must wait for the close of the candle 9:00-10:00 to begin the trade because the high and the low of the orange box are determined by that candle (and the two precedents).
The beginning of the trade is at 10:00 (London time)!
That's right ?
If it's wrong, I must change my settings.

The 10 candle is the one that is formed outside of the box. If this same candle breaks outside of the red box if your looking at the hourly chart. The box high and lows are determine by the 7-9 high and lows during that trading period. The 10 candle...as soon as it is formed (10:00:01), you watch this candle as if it was the start of the Grand Prix race. From that point you watch the direction and along with the other indicators, if it agrees with the indicators and it breaks the height of the box, you should take the trade going long and opposite direction for short. Continue watching the indicators associated with this movement.

I trade large lots so I am only taking 25 pips which is very easy to obtain.
  • #722
  • Jan 8, 2008 4:38am Jan 8, 2008 4:38am
Thanks
So, actually your settings are periodbegin = 6:00 and periodend = 9:00 ?
OK ?
  • #723
  • Jan 8, 2008 4:50am Jan 8, 2008 4:50am
Quoting madscalp
Thanks
So, actually your settings are periodbegin = 6:00 and periodend = 9:00 ?
OK ?
Here you go, exact settings my friend.

I got my pips with GBP/JPY and EUR/JPY. Waiting for my EUR/USD to come thru.
Attached Image
  • #724
  • Jan 8, 2008 5:03am Jan 8, 2008 5:03am
All right, my friend, it's good.
Just a question: when are you sleeping in Tennessee ? http://www.forexfactory.com/images/icons/icon10.gif http://www.forexfactory.com/images/icons/icon10.gif
Best regards.
  • #725
  • Jan 8, 2008 5:09am Jan 8, 2008 5:09am
Quoting WHTenn
The 10 candle...as soon as it is formed (10:00:01), you watch this candle as if it was the start of the Grand Prix race.
So that 10 am bar would be the very start of London session, right?
  • #726
  • Jan 8, 2008 5:15am Jan 8, 2008 5:15am
Quoting madscalp
All right, my friend, it's good.
Just a question: when are you sleeping in Tennessee ? http://www.forexfactory.com/images/icons/icon10.gif http://www.forexfactory.com/images/icons/icon10.gif
Best regards.

Since the trading hours start after 2am, I have grown accustomed to staying up and trading.
  • #727
  • Jan 8, 2008 5:16am Jan 8, 2008 5:16am
Quoting ssotiro
So that 10 am bar would be the very start of London session, right?
Correct my friend
  • #728
  • Jan 8, 2008 5:22am Jan 8, 2008 5:22am
Thank you. The reason I am asking is because of the controversy on "fake breakouts" during the 1st hour of the London session.

I'll try to do a visual backtesting between 10 and 11 (one full hour after London opens). It would be interesting to see what this brings.I'll let you know when (and if) I get around to it.
  • #729
  • Jan 8, 2008 6:17am Jan 8, 2008 6:17am
Quoting ssotiro
Thank you. The reason I am asking is because of the controversy on "fake breakouts" during the 1st hour of the London session.

I'll try to do a visual backtesting between 10 and 11 (one full hour after London opens). It would be interesting to see what this brings.I'll let you know when (and if) I get around to it.
it was my question too
the backtestings 6:00-9:00 and 5:00-8:00 are totally differents for EURUSD
  • #730
  • Jan 8, 2008 7:24am Jan 8, 2008 7:24am
Quoting madscalp
it was my question too
the backtestings 6:00-9:00 and 5:00-8:00 are totally differents for EURUSD
I am all ears... what are your thoughts on the backtesting? Do you like the 5-8 better on EUR/USD?
  • #731
  • Jan 8, 2008 7:31am Jan 8, 2008 7:31am
Quoting WHTenn
I am all ears... what are your thoughts on the backtesting? Do you like the 5-8 better on EUR/USD?
no, the 6-9 is better
i don't know why !
  • #732
  • Jan 8, 2008 8:46am Jan 8, 2008 8:46am
Quoting ssotiro
Thank you. The reason I am asking is because of the controversy on "fake breakouts" during the 1st hour of the London session.

I'll try to do a visual backtesting between 10 and 11 (one full hour after London opens). It would be interesting to see what this brings.I'll let you know when (and if) I get around to it.
If you put a few pips offset on box it filters out some of the false breakouts on some pairs. I,ve noticed EUR/USD several times just breading out 1 or 2 pips and then reversing.
  • #733
  • Jan 8, 2008 9:34am Jan 8, 2008 9:34am
I trade large lots so I am only taking 25 pips which is very easy to obtain.[/quote]

Do you use 25 pip target for all pairs?
Do you use Stops and if so how big?
Do you close trades good or bad at any certain time if target not reached?
  • #734
  • Jan 8, 2008 9:39am Jan 8, 2008 9:39am
I would like to add an observation and share a technique I have been using with this method for some time. To avoid 'false breakouts' of the box, add a Stochastic Oscillator (5,3,3) to your chart (a standard MT4 indicator).

As soon as the "Breakout Box" has completely formed, drop down to the 5 minute chart. Or you could just start at that time frame if you prefer.

When price is about to break out of the box, consult the Sto Oscillator. DO NOT TRADE AGAINST this indicator on the 5 minute chart! Wait for the Sto to agree with the price breakout of the box. There will be times when a good trade is missed, but there will be more occasions when a bad trade is missed. The net result will improve your trading.

I have attached two charts. The first shows waiting for maximum trade gain; the second shows avoiding a "false breakout". This helps me tremendously; I hope it helps others too!
Attached Image(s) (click to enlarge)
Click to Enlarge Name: eur_usd1.png Size: 31 KB
Click to Enlarge Name: eur_usd2.png Size: 31 KB
  • #735
  • Jan 8, 2008 9:47am Jan 8, 2008 9:47am
This was yesterday's trade!
Attached Image (click to enlarge)
Click to Enlarge Name: eur_usd.png Size: 33 KB
  • #736
  • Jan 8, 2008 10:51am Jan 8, 2008 10:51am
It's my understanding that this method is keyed to the opening of the London market. The "Breakout Box" closes when London opens at 8:00 GMT.

However, a visual survey of EUR/USD would suggest that a large amount of price movement takes place in the one hour preceding the London open. I would attribute this to trading that takes place in Europe because those markets open one hour before London. Therefore, if the "Breakout Box" closed one hour earlier, it would be smaller, more compact and would appear to provide greater trading opportunities and hence larger gains, especially when filtered with the Sto Oscillator I referred to in the above two posts.

Other currency pairs would probably be different. For example, I've observed that adjusting the "Breakout Box" to correspond with the Sydney and Tokyo opens works well with currency pairs closely correlated to those markets.

Any thoughts on this?
  • #737
  • Jan 8, 2008 11:05am Jan 8, 2008 11:05am
Quoting BeachBum
It's my understanding that this method is keyed to the opening of the London market. The "Breakout Box" closes when London opens at 8:00 GMT.

However, a visual survey of EUR/USD would suggest that a large amount of price movement takes place in the one hour preceding the London open. I would attribute this to trading that takes place in Europe because those markets open one hour before London. Therefore, if the "Breakout Box" closed one hour earlier, it would be smaller, more compact and would appear to provide greater trading opportunities and hence larger gains, especially when filtered with the Sto Oscillator I referred to in the above two posts.

Other currency pairs would probably be different. For example, I've observed that adjusting the "Breakout Box" to correspond with the Sydney and Tokyo opens works well with currency pairs closely correlated to those markets.

Any thoughts on this?
good idea
so, you think to use settings 5:00-8:00 (EURUSD) with sto filter
why not ?
I'am trying
  • #738
  • Jan 8, 2008 11:10am Jan 8, 2008 11:10am
Quoting BeachBum
This was yesterday's trade!
What time do you have your box set for? Looks like it might be 1 hour different than most of us have been using.
  • #739
  • Jan 8, 2008 11:33am Jan 8, 2008 11:33am
Quoting Abnormalone
What time do you have your box set for? Looks like it might be 1 hour different than most of us have been using.
OK here we go, the great time discussion.

I have the box set to close at 7:00 GMT. If you look at my posted 5 minute chart from yesterday, you can confirm that time........
  • #740
  • Jan 8, 2008 11:43am Jan 8, 2008 11:43am
Quoting BeachBum
OK here we go, the great time discussion.

I have the box set to close at 7:00 GMT. If you look at my posted 5 minute chart from yesterday, you can confirm that time........
hmm...there is no time on your charts ......http://www.forexfactory.com/images/icons/icon10.gif http://www.forexfactory.com/images/icons/icon10.gif http://www.forexfactory.com/images/icons/icon10.gif
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