4H Breakout Forex System

4H Breakout Forex System is forex strategy trend following that uses a breakout trading formation.
Time Frame 4H or daily.
Currency pairs: major.
Forex Indicators:
30 EMA, close,
150 EMA, close,
200 EMA, close,
365 EMA, close.
The 30 exponential moving average is the trend indicator, when price is in trend it retraces to pull back to the EMA 30 periods.
The 150, 200 and 365 exponential moving averages are ynamic support and
resistance. . You will often get a breakout formation after price has bounced off of one of these
moving averages. They are also very useful as target areas for profit taking on open positions.
There are 2 types of breakouts that I trade one is more reliable than the other, it is up to you if you choose to trade both or not. The first is a trend line breakout see diagram below for example.
4H Breakout Forex System
Price is in a up trend and formed a trend line against the trend. When the price broke out and come back to the trend line giving us a good opportunity to buy in the direction of the trend.
The second and more reliable setup is a double top/bottom breakout. Double top/bottom are one the best pattern formation for trading, see picture below.
4H Breakout Forex System
Price is in an up trend and formed a double top against the trend. Price then broke out and retraced back to the trend line giving us a fantastic opportunity to buy in the direction of the trend.
Rules 4H Breakout Forex System
1. Check the trend direction with 30 EMA.
2 Wait the consolidation market.
3. Wait for a break of the consolidation (check also the volume that tends to increases.
4.Watch for a retrace back to the support/resistance line that wasjust broken.
5. enter on the touch of the support/resistance line that was just broken
6. Place your stop well behind the support/resistance line.
7. Move your stop to break even after you are in profit by the same amount you risked.
8. Stops can be trailed by a pip amount or trailed manually behind bar lows in a up trend and bar highs in a down trend.
Trade Examples
4H chart of the EURUSD  
4H Breakout Forex System
As you can see the above chart is in a clear up trend, price is moving away from the 30ema and staying above it most of the time indicating a strong trend. Once we have a clear picture of the trend direction we look at support/resistance areas for consolidation, this can be trend lines or horizontal lines for double tops/bottoms.
4H Breakout Forex System
On the above chart there is a lovely upwards sloping trend, price is clearly above the green 30ema and is consolidating below the trend line. If you look carefully at the breakout on this chart you will see that price shot up then retraced as the candle closed. On the opening of the next candle price took off to the moon, lets checkout the lower time frame again.
4H Breakout Forex System
Above is my current live trade on the USDCAD, as you can clearly see the pair is in a downtrend and below the 30ema.
4H Breakout Forex System
This is a recent trade I took on the EURUSD, a very clear double top was formed a while back and I have had my eye on it ever since. After a huge drop off price fought back and broke through the resistance created by the double top.  
4H Breakout Forex System
Above there is a perfect consolidation forming above the 30ema with a trend line. Price broke out and I had my buy order ready at the trend line but unfortunately price left without me on board. This will happen sometimes and It’s a fact of trading you cant win them all. Be patient because like busses there will always be another one coming along soon.
In the picture t below is just after I entered the trade, NZDUSD created a lovely double top in an up trend. The double top was broken with a volume candle and then retraced back to the support line triggering my order. I placed a 50 pip trailing stop to lock in profits and a profit target chosen from the daily chart if it gets that far.
4H Breakout Forex System
Template Metatrader 4 with Watal Trend line. The main feature of Watl trend line is that draw also the historical trend line on the chart.
4H Breakout Forex System
Below the link for download 4H Breakout Forex System for Meatrader 4 with Watl Trendline indicator MT4
https://drive.google.com/file/d/0Bwjv2Pbf48itR2I3RXhabUJNZjA/view?usp=sharing

Related

Breakout Forex Strategies 5199919512501558240

Post a Comment

emo-but-icon

item