The Forex Scalpers The Breakout Strategy
As we all know by now I have been using the break-out strategy for years. This strategy fits best with me. I focus on 1 to 2 pairs mainly usdjpy & gbpjpy and sometimes gold. why? because these couples, as far as I am concerned, have the most voyality with heavy momentum and trending markets.
For the breakout strategy we therefore need a trending market. a trending market can be found around the openings of the currency markets. london / new york mainly. Also as we all know, I always sign my support & resistance on the daily because I want to see the range we are in.
Then I go to the h4 and or h1 to draw my zones, we will not go further here by about the concept of zones because this is already a pdf about and several webinars see that section also if you want to know more about it.
Okay to continue on the breakout strategy I look for trending markets currency markets opening of the opening up to 2 to 3 hours after the opening why? we then have the heaviest momentum and most voyality.
As you can see above I have 3 days highlighted london and newyork you will also see in your own chart that we have the most voyality between 09:00 and 18:00 CET Amsterdam time zone.
Dont ask me what time for USE GOOGLE to find out! but as you see, the market has the most sense of humor. We have thick candles and is clearly a fierce trending market. in this time period you want to go so, as long as there is no news! forexfactory.com for news avoid redmap and orange map news. If you trade the usdjpy, avoid both USD & CAD news! trade your gbpjpy then avoide your GBP & EUR news these 4 countries work closely together and therefore have a heavy effect on the market when there is news. but to go deeper into it we must understand that around this time most buy and sell orders in the market and we want to flow with the waves that we have from the banks and instutions because in the end run the forex market.
To continue, I will give a few more examples of clear breakouts & retest so I want clear and strong breakouts of 4 hours or 1 hour zones! if the price is trending because we then have the greatest chances to break a strong price lwhich then ends in a break of at least 20 to sometimes 50 pips, where we can then easily take 5/10/15 pips as scalper. But why do not you go for more pips? because I am a scalper and therefore want a small piece of the pie and want to place myself in the best position possible! see below a number of examples of clear and strong breakouts.
As we can see above I have highlighted and number of zones and a number of breaks have been observed. You can see that the breakouts are mainly around New York and London as explained earlier. You also see that with every break out the price is in a heavy trend and therefore heavy in heavy momentum.
Below I will show you an example on lower time frame the break + retest you will see that the price after a break acts as a kind of wave.
It always comes back that we call a pullback or well known (retest) the banks and instutions ,they drive back the price for the premium price, as a result many retail traders will lose their hold or lose their trades. many traders are NOT aware of this.
Wait patiently for a breakout or a retest though although the retest does not always take place but 9 out of 10 times this does happen that the price for at least 50 to 70% returned this is the time to make entries because the price in momentum is we know that we will continue this ride you can see it as a kind of gas station the car gets refilled and then the ride continues from zone to zone.
We have enough buy or sell orders in the market in an uptrend we talk about buy orders zone to zone. in a down trend we talk about sell orders in the market that are being pumped into the market with trillions at the same time by the 'bigboys' the bank and instutions.
Above we look at the pair gbpjpy my favorite pair with a very high voyality during london & newyork session. as you can see we are clearly here in bearish marketstructure and you can clearly see the waves against the trendline we make clear lower highs & lower lows which indicate bearish market structure we are in a down trend sell positions. because we want to put ourselves in the best position with a high % of winrate. all zones are base of the 4 hour time frame ( you can also use the h1 zones for more entrys per day look left) you see that the price is nicely in between, every time a zone is broken as previously indicated that the price at a break comes back for a retest (premium price) the banks push the price further down and many stops are hitting. Not us why? because we have entry on the retest, we are therefore entering into the big boys' banks at the same time. so wait patiently for the retest! and put yourself in the best position possible. after each break there will be a number of retests as long as the price is in momentum. after every wave there is a break and vice versa with an uptrend a bullish market.
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