17# Range Breakout Trading System
Submit by Joy22
Time Frame: 15 or Higher
Currency Pair: All.
MACD (12,26, 9)
We need to determine the highest and lowest levels of a range. For this
we need at least one extreme point for each level and, for drawing lines
of Support & Resistance, we need at least two points.
Point 1 is at 0,7821 and point two is at 0,7815. By drawing a line at the
123.50 level (the higher of the two), we have determined the upper
level of the range.Point 3 is at 0,7799 and point 4 is at 0,7798. We use the 0,7798 level accordingly, being the lower of the two, and draw a trend line.
In the picture below Range Breakout Trading System in action.
We should wait until a one candle/bar closes above the Resistance;
We should wait until a one candle/bar closes below the Support;
The pullback didn’t extend beyond either the 5 or 34EMA levels.
2. During the pullback, the MACD remained negative.
To clarify, the market moved up after a strong downward movement
creating the first white (bullish) candle – it indicates the beginning of
After that, a second white (bullish) candle was formed, followed by a
black (bearish) candle.
All this occurred while price remained below both the 5 and 34EMAs and
with the MACD in the negative zone, as shown on the following chart.
There are many methods for trading breakouts; the most widely used is
to place Stop orders at levels 3-5 pips above and below the defined
range levels, however, we have our own approach.
For Re-Entry stops is 10 pips above or below 34EMA.
1/5 Ratio. Example if stop lossis 20 pips the profit target is 30 pips.
Before using this method, pratice at draw the range and test it !
Share your opinion, can help everyone to understand the forex strategy.
Channel Breakout Forex Strategies