Forex Questions and Answers - FXAnswer

Do I need to zoom in to a smaller time frame to trade breakout? Not necessarily. Higher timeframes are always more reliable than small time frames.2. Should I trade the break out candle? I would wait for price to break out, retrace to a fib level, and then look to enter in the direction of the breakout if you get price action confirmarion of continued support of the direction of the breakout.3. does the break out candle need to close above/below the res/sup line? Must close above S/R line if you intend to enter on the "breakout candle/bar"4. Should I wait to enter until the res/sup line gets tested after the breakout? I would wait for the close of the candle/bar to be outside of the S/R line.5. How to identify the false break out? A false breakout is any breakout not in the direction of the longer term trend.It's impossible to identify a false breakout before it breaks out. All you can do is cover your a** and protect your bottom line.6. how many entry points in break out? and success rate of each entry point. You can enter on the breakout of the closing candle that breaks through S/R (Too risky IMO). You can wait for the breakout to happen and then enter on the retracement.

by

Harold

1 year ago

Breakout trading refers to prices "breaking out" of either a technical pattern such as a triangle, a consolidation range or trend channel.

The theory of breakout trading is that price momentum will continue to carry the stock far enough beyond the breakout point for the trader to be able to seize a profit. One, three or five minute charts can be used for traders using breakout trading for intraday markets, while daily charts are best for end of day breakout trading.

Breakout trades can be either long or short based on the direction of the break. However, breakout trades will always be with the general direction of prices (i.e., pro-trend) and never against it.

by

Warren

1 year ago