17# Range Breakout Trading System
Range Breakout
Submit by Joy22
Time Frame: 15 or Higher
Currency Pair: All.
Indicators:
5EMA,
34EMA
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.
Entry Long:
We should wait until a one candle/bar closes above the Resistance;
5EMA >34EMA;
MACD>0.
Entry Short:
We should wait until a one candle/bar closes below the Support;
5EMA <34EMA;
MACD<0.
RE-Entry:
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
the pullback.
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.
Stop Orders:
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.
Profit Target:
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 !
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FSR (Tuesday, 22 October 2024 00:42)
The strategy is built with basic technical indicators that are on all platforms, the range is then drawn on the chart manually based on support and resistance zones defined discretionarily.
Otherwise you can build the strategy based on a range indicator.
range breakout or boxbreakout, I think they are available on MT4, MT5 and TradingView.
Robert (Monday, 21 October 2024 17:22)
No Download Link
Ranjith (Wednesday, 20 November 2019 00:16)
Nice indicator
bhavesh (Monday, 20 June 2016 21:39)
download