Breakout Trading Strategies

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Trading breakouts is not a new concept; traders have been using breakouts for centuriesToday many of the world’s top traders trade breakouts for big prots. So what actually is a breakout?

A breakout is the point at which the market price breaks away, or moves out of a trading rangeThe trading range can be for any length of time but once prices exceeds the high or low of the range, a breakout has occurred.

The accepted market wisdom is “buy low sell high” and this has been taught to us in high school and is the accepted philosophy of many of the world’s investment community, from economists to brokerage houses. The theory sounds ne, but it is very difcult to make money trading this way. The logic of breakouts is 


contradictory to this accepted market wisdom and works on the premise: That in order to make money you should “buy high and sell higher” in a bull market, and “sell low buy back lower” in a bear market.

So why is the traditional investment wisdom of “buy low sell high” so difcult to make money in the real world of trading? For this we need to take a closer look at price action and the attitude of the majority of investors.

Why Breakouts Increase Protability & Decrease Your Risk

Perhaps the most famous traders in the history of trading were the “Turtles”. The turtles emerged from a meeting between Richard Dennis and Bill Eckhardt about whether great traders were born or made. Bill felt that he could teach people to become successful traders. Richard felt that successful trading was down to genetics. In order to settle the debate, it was decided to advertise for

trading apprentices and then try and teach them to become successful traders. The 

students were called the “Turtles” when Dennis explained the concept by saying they were “going to grow traders like they do turtles in Singapore” They were the most successful trading experiment in history, earning an average compound rate of return of over 80%. It was proved that with a simple set of rules complete novices, with no experience, could become successful traders. The rules used were simple and included the use of breakouts in the methodology taught. While only one component of the


overall plan, the breakout methodology was very important part of how the traders actually got into and held the big trends for maximum prot.

In the book “Market Wizards”, there is a very good interview with Bill Eckhardt and his analysis on what made the Turtles so successful. He illustrates the point further that traders, in their desire to “buy low sell high”, create risk for themselves. By doing what is conventional and comfortable for them actually means they end up missing the biggest trends, and creating a greater risk for themselves, by lowering their probability of entering at the right time and making an overall prot.

Breakouts Make Your Money Work Harder

Another important reason for using breakouts, rather than buying low or retracements,

is that trading capital is utilised better. It is the aim of all traders to lock into and hold trends. The fact is, however, that markets spend most of their time in trading ranges going nowhere. Many markets don’t trend for months or even years. A trader who takes a trade in the anticipation that it will move, may have to wait a long time to see the trade move his way, if it does at all. This can tie up capital for long periods that could be utilised more productively elsewhere. The big advantage of breakout trading is you are only entering a trend in motion. As we all know, a trend in motion is more likely to continue than reverse. This is a basic premise that technical analysis is based upon, and

breakouts get you in, as the trend emerges, and has a high probability of continuing. You therefore know you are only entering markets that have a high probability of trending strongly and making you big prots.


Breakout Forex strategies

1#Channel Breakout with pullback

2# Open Day

3# Inside Day Breakout

4# Intraday Breakout

5# Channel Breakout and Moving Average

6# London Breakout

7# Optimus Channel

8# Breakouts System

9# Breakout With CCI

10# Asian Breakout

11#Daily Breakout

12# Hans Breakout

13# Breakout H1 Method 

14# Box Breakout System 

15# Box Breakout System 2

16# Key Points 

17# Range Breakout 

18# Day Breakout 

19# Magic Breakout

20# Two-bar Breakout System

21# 100 pips daily

22# Asian Breakout II

23# Breakout Sqaulou 

24# Box Breakout 3 

25# 2 Days Breakout

26# The Retrotrader 

27# Asian Breakout 

28# Breakout 30 pips 

29# Forex Breakout 

30# Verbtheory's 

31# 4H Breakout

32# Counter Strike 

33# Channel Breakouts

34# Breakout Trading in All Market Condition

36# Early Bird 

37# Donchian Breakout 

38# Trendline Breakout 

39# Breakout Weekly Strategy

40# Hans123 Breakout

41# Range Breakout

42# King Cobra Breakout

43# FX Milion

44# Breakout Scalping Trading Session

45# SDX Breakout 

46# Box Breakout and Ema Channel 

47# Joker Breakout 

48# Grucha Channel Scalping Breakout

49# London Breakout III 

 50# Trend Dynamic Breakout

51# Exponential moving average Fractal system

52 #60-minute breakout system

53# True Breakout System Basic

54# London Open Box Breakout 4 Trading System

55# Tunnel with Box Breakout V.5 Trading System

56# Breakout secret revelead Trading System

57# Breakout Zones

58# ATR Channel Breakout Swing Strategy

59# 3 Breakout Box

60# Trendline Demark Breakout system

61# Breakout the Phases Zone

62# Box Early Breakout Bird System

63# Forex Breakout of the morning

64# Channel Breakout ATR

65# Best Intraday Breakout 

66# Breakout Directional Intraday 

67# Correlation Breakout

68# FX Breakout


69# Morning Flat