SPES Intraday Breakout System

I'd like to restart a forum about my trend-following and right-side breakout intraday trading system, I failed to manage the old forum as it was hard to give live analysis here, so this time I will use another way - daily update. This will surely help me to maintain a trading journal and hopefully it could also help FF traders who are interested in this system.

Brief to the system
This system uses a trend-following and right-side breakout strategy; therefore, I only try to find entries on one direction based on my daily analysis. It could be working on any forex pairs, and I also use it on gold, silver and oil. Generally, at the beginning of each day, I search all pairs on high time-frame charts (Day, H4) and find several ones with clear direction bias during the day; then I wait for the entry signals on low time-frame (H1, M15, M5) to take entry. Some days there are several trading opportunities but some days there are none if no pairs have clear trend.

From my experience, if you only take the entry on very good patterns, you may reach 80% winning ratio. Though the number of trades falls, possibly 5-8 times a month, but with good risk reward ratio, you could still get fantastic result, maybe better.

About Risk Management
I don't want to talk much about risk management (money management). The rule is quite simple. Never risk more than 2% of the amount you wish to invest in forex market per trade. Example, if you wanna invest $10,000 in forex market, you can deposit all the money in your trading account, or half, or only $2000, but never lose $200 per trade. Use your balance and stop loss to calculate you lot size before take the entry. Don't dream of making your account double in few trades, if you risk 30% or 50% of your balance per trade, though you may have 80% winning ratio, you're still possible to lose everything.

Technical tools and indicators
No special indicators are used in this system, only basic tools and indicators are applied. From this aspect, I believe this system will keep being effective in a long run.

Candlesticks Patterns includes Marubozu, Hammer, Shooting Star, Engulfing, Morning & Evening Stars, etc. They are mainly used on higher time frame to determine the direction. Chart Patterns includes Double Tops/Bottoms, Head and Shoulders, Rectangle Patters, Wedge Patterns, etc. They are used on higher time frame to determine the direction and trading room.

Support & Resistance Levels includes Horizontal S&R levels, Trendline, Fibonacci level. They are used to determine if there are enough room for trading.

Moving Average includes 15EMA used as S&R levels and 50SMA used as an reference for direction.

Multiple Time Frame Analysis. With other tools/indicators, we find the trading direction on higher (H4, Day) time frame and entry opportunities on lower (H1, M15, M5) time frame.

Stochastic Oscillator (5,3,3) is only used on H4 chart to support our decision, it confirms long when it goes up or above 80, or confirms short when it goes down or below 20. It is only a supportive indicator and sometimes it could be ignored.

ADR (20) is used to confirm if there is enough room for intraday trading. If the range between current price and ADR line is smaller than stop loss, give up this entry. There is no ADR indicator on MT4 and for copyright reason I cannot share it here. You can use ATR (20) on daily chart, and it has the same value as ADR. Otherwise you can PM me and I can send it to you via email.

Checklists before taking the entry
1. Always follow the intraday trend on high time frame (day chart, H4 chart)
2. Have enough trading range between entry price and key S&R level (also ADR)
3. Reasonable risk - risk reward ratio must bigger than 1 (actually only 1.5 or more potential risk reward ratio is attractive to me)
4. Right-side trading - don't trade at important S&R levels, trade after they are broken
5. Price has tested or broken key level before breakout
6. Candlesticks pattern supports trading direction
7. Indicators support trading direction (H4 Stoch, MAs on M15 chart)
8. Price has a fake/cheat movement before breakout

1-4 are essential and more rules from 5-8 you follow more chance you could win.

What I will do here:
After day candles complete, I will give a brief trading plan (words only) on pairs with potential entries for the next trading day.
In next trading day, if a trade goes with the plan, I will update it here, no matter I take the entry or miss it.
If price goes against the plan, or goes with the plan but is not satisified with my entry rules, I will ignore it.
This update may miss good opportunities if the trend is not clear at the beginning but is confirmed during the day, I may not be able to update them promptly.

Rules/notes for this forum:
1. Trade at your own risk. Do not trade with big real money until you understand this system well, use demo for practicing. Always put reasonable stop loss when you take a trade (usually above/below previous high/low on M15 chart).
2. This system needs patience and practice, and intraday trading is not suitable for everyone, but if you can follow for weeks, you will definitely learn something helpful.
3. Please ask questions only related to this system, and questions with charts are most welcomed.

daily update 26/10/2016

XAUUSD-long I won't take long trade on gold unless it shows very good pattern, because the trend on day chart is still going down. If price could stands above 1277 and gives satisfied consolidation, I may take long when breakout happens, the target will be ADR.

AUDUSD-long If price could test or break resistance around 0.7655-58 and then gives satisfied consolidation, take long entry when price breaks today's high. First target is ADR, and 0.7734 after that.

EURAUD-short Use 15EMA on H1 chart to look for reasonable entry when price breaks 1.4213, otherwise we have to wait for 1.4184 support being broken and then look for another short entry.

EURNZD-short 1.5160-70 support is essential, I will only look for short entry after this level being broke.

AUDJPY-long Look for long entry based on 15EMA on H1 chart above 80.00 resistance.

NZDCAD-long Look for long entry based on 15 EMA and trendline on H1 chart when price breaks 0.9571, protect long position when price reaches 0.9594. First target is ADR and next is 0.9685.

With overexpected high CPI of Australia, AUD gave us some opportunities today. AUDUSD and EURAUD both go with the plan.

AUDUSD directly breaks resistance 0.7655 without any consolidation, so I don't see it as a very good opportunity, but you can see the momentum is strong with a fake downside movement before breakout.


EURAUD has a better potential risk reward ratio, and it exactly goes with the plan, it's a good opportunity.

[email protected]

Let's see what will happen tomorrow.

ok, pls share the system.