Get started

4h

GBPUSD 4H TRIANGLE BREAKOUTTriangles are repeatable trading chart patterns. Triangles are consolidation chart patterns that can breakout either direction. Each chart pattern will have defining trendlines of the support/resistance levels creating the pattern. What ever time frame you are trading this chart pattern, wait for a candle close outside of the trendline in the direction of the breakout candle. (Our time frame preference is the Daily chart). Add volume indicator - Volume is the amount of $ that went into a particular candle or in Forex the # of trades that took place. Add ATR indicator - Volatility is the amount of price movement that occurred. Use the ATR to measure the price movement. When you see descending Volume bars and descending ATR line (which indicates volatility) this shows a dis-interest in traders to invest in this pair creating consolidation which creates the chart pattern. Trade Management after there is a breakout candle close. 1 - Position size (compare volume bar to volume ma line). a - Breakout candle must be 100% of volume average for a full position size. b - If 75% of volume average then ½ position size. (To find 75% of Volume look at the charts volume settings – divide smaller # into larger # = 75%+) If not 75% then stand aside from the trade. 2 – If candle breaks out of a trendline, 15m before the close of the day prepare your buy/sell order. Enter two trades. 1st trade will have a SL & TP. It will close automatically when the 1st TP is hit. 2nd trade only has a SL and will be allowed to run. When 1st TP is hit move the SL to breakeven. Look at ATR and prepare SL at 1.5 of ATR. Prepare 1st trade TP at 1 of ATR. 3 - SL for both trades will be 1.5 x ATR. 4 - 1st trade TP will be 1 x ATR. 5 - No TP on 2nd trade – letting profit run and adjusting SL to follow price. 6 - When 1st TP hit – move 2nd trade SL to breakeven. 7 - Adjust the 2nd trade SL to follow price. *8 – After Breakout candle – if price closes back into chart pattern close trade don't wait for SL to be hit. *9 - When breakout candle is more than 1 ATR from breakout candle open. a - Enter 1st trade at candle close with ½ position size. b - Enter 2nd trade with a pending limit order that is 1 ATR of breakout candle open. c – Price should pullback to that pending limit order for 2nd trade. d – If Price returns back into chart pattern close trade before SL is hit.
by Tradingstrategyguides
1
1D SMITH WESSON TRENDLINE BREAKOUTTrend Line Trading: The Trend Breaker Strategy This trendline breakout trading strategy uses three indicators, which are the following: MACD- The inputs for this indicator are: Fast Length= 12 (represents the previous 12 bars of the faster moving average), Slow Length= 26 (Represents the previous 26 bars of the slower moving average), and Signal Smoothing= 9 ( represents the previous 9 bars of the difference between the two moving averages. This is plotted by vertical lines called a histogram). Simple Moving Average- The inputs for this indicator are: Length 8, Offset 0. (Red line) Exponential Moving Average-The inputs for this indicator are: Length 20, Offset 0. (Blue line) This Trend Breaker strategy also uses three different time frames. They are the 4 hour, the 1 hour, and 15 minute time frames. This top-down approach uses these time frames to identify a trend, find a breakout point, determine an entry point, and execute the trade. Step One to trend line trading: Identify a trend The first thing you need to do is identify an upward, downward, or sideways trend by switching to a 4-hour and 1 hour time frames. The reason both are used is that it will give you the best perspective in determining a trend according to this strategy. Draw a trend-line so that 3 points of resistance or support was touched. We created this trendline trading system so that you could easily enter trades without a lot of guesswork on your part. Here You can see a funny video about trading levels. Since this strategy focuses on trends, a trend line will be drawn on the support or resistance lines of the trend. The criteria for a trend is that there needs to be at least three points of resistance or support. As you can see on the 4- hour time frame this clearly is a downtrend. Below is the same chart only this is a 1-hour time frame. This is just to get another perspective of this downtrend. It is good to do this to completely confirm this trend by identifying 3 levels of resistance. Trading with trend lines is not easy, that is why it is important to have a clear system of step by step rules to make it easy for you to follow. Step Two: Identify a Breakout point Trendline Trading System In order to find a breakout point of the trend that was identified in step one, the strategy will use a combination of the three indicators (MACD, 15 minute SMA, EMA) to identify a break out on the 15-minute time frame. This time frame is used because a trend was already identified in step one on the 4 hours and 1 hour time frames. As you can see in the chart above on the 15-minute time frame, the MACD lines were crossed. When the crossover of the fast length and slow length occurs, this will signal a new trend. This gave an indication that a trend was breaking. The moving average and exponential moving average lines also crossed. So when the MACD lines cross and the simple moving average/ exponential lines cross wait until the candlesticks go above/below trend line that was drawn in step one, then identify a point of entry into the trade. One of the reasons we like trend line trading so much is that it is straight forward and simple and we recommend all traders have something simple. So looking at our example above the criteria was met to go to step three because the SMA and EMA crossed and the MACD lines crossed. Also, the trend went upwards and hit our trend line. This is a signal to go to step three. If neither of the indicators crosses before the candlesticks close and hit the trend line then do not go any further because the trade does not meet the criteria of the rules. The indicators need to show that the trend broke before it touched the trend line. Note* When our indicators are crossing, the trend needs to be heading toward the trend line that was drawn in step one. This is because the trend is breaking and a breakout is about to occur. When the breakout happens we will discuss when to make an entry. Step Three: Trend Line Trading Identify a point of entry Here is a list of the entry criteria: These 4 things must happen to enter a trade with this Trend Breaker Strategy. Simple Moving Average Must Cross below the Exponential moving average. Macd Must Cross The price must break below or above the trend line. After the break of the trendline, you must wait for 3 candles to close on the 15-minute chart before taking your entry. Now we need to identify a point of entry. To identify a point of entry always use the 15 minute time frame in this strategy. So in our example below, we see that there is an obvious stand-off between buyers and sellers on the trend line. Once there are at least three candlesticks above or below the trend line, you execute the trade. In this example, there are three candlesticks that fell above the trend line after our indicators signaled that the trend was broken. At this point, you want to make an entry. Also, read about Trader's Tech and Installing MT4 EAs with Indicators. Step four: How to Trade with Trend Lines: Determine where to place a stop loss. 1 Use Pong Position Icon on left side toolbar. Adjust Top Prifit line until center text says 1 to 3 risk reward. This will show you where SL should be placed. OR Place a stop loss past the last support and resistance levels in the trend itself. Again, use the 15 minute time frame to find this point of resistance/ support level. In the example shown below, place the stop loss below the last support level. This will ensure that if there was a bearish move, it will hit the last point of support and make a bullish move upwards. You can clearly see that there are two levels of support in the above example. Use the support levels to determine the stop loss. The rules were to place the stop loss below the last support level which is why you see the stop loss below these levels. Step five: Trendline Trading System Exit Strategy The plan clearly identified a trend, a breakout point, point of entry, and determined a stop loss. The final step is to determine the exit point. This Trend Breaker strategy uses 1 risk to 3 reward ratio. What that means is you have the potential to make 3 times more than you are risking. Use the Long Position Icon on the left side toolbar. Adjust top profit level until the center text says 1 to 3 risk reward. Conclusion This Trend Breaker Strategy is simple and yet effective. There is no need to stress and worry that you made the wrong trade. You follow the rules and do not let anything else make you back out of a trade. If it follows the rules, execute the trade with confidence. Always remember to only be risking no more than 2% of your account! This will help you identify daily trends and points where they break. There is no need to force yourself into a trade. If it does not follow your rules and guidelines then search for another pair to trade. Feel free to check out one of our other trading strategies.
NASDAQ:SWBIEducation
by Tradingstrategyguides
1
XAUUSD DropGold is still moving in a downtrend channel overall, new lower highs are being created, but what's interesting is this last touch. On the 4H chart we can see clearly that a H&S pattern has formed and if we scale down to the smaller time frame we can see that more lower highs are being made in the right shoulder, the moment price breaks structure, pullbacks and creates a nice entry signal we can enter. The drop could see some pressure on the untested demand zone and if it breaks it we can see a lot of liquidity there and a possible drop to for a new lower low.
OANDA:XAUUSDShort
by AvramovFX