Today I want to bring to your attention a simple, unusual and interesting trading strategy.
- Its simplicity is that it works on just one indicator.
- The unusual thing is that you will not need to sit with her all day at the monitor screen. It is enough to enter the terminal just a couple of times in order to decide in which direction to open trading positions today and whether to open them at all today.
- It can be called interesting for the two top points. However, we call “interesting” everything that we didn’t know before and in which we have aroused interest today.
Now we will analyze a breakout and effective trading strategy called ” EURJPY Breakout Strategy “. As you probably guessed from its name, it works with the EUR / JPY (euro / yen) currency pair . The algorithm of its work is based on a single author’s indicator called ” 3 Tier London Breakout V.3.2b “.
Naturally, you will not find it in the standard package of your terminal tools. You will need to download the indicator and template at the end of this article. After that, the instrument itself can be pulled onto the chart from the ” Template ” context menu , called by right-clicking on the background of the terminal working window.
If you trust the classical analysis more, you can download the basic course of the TS “Sniper X” for free. This is the best non-indicator TS that consistently brings profit starting from the first day of trading.
The EURJPY Breakout Strategy was found on the forexfactory in English . We have specially translated it for you to tell you about it and show you how to work correctly with this trading system.
The date of its creation is January 2018. The strategy aroused keen interest among users, it is actively discussed by them today. The forum already has 71 pages of user posts and comments to it.
Trading rules for TS “EURJPY Breakout Strategy”
The TS operation is based on an indicator that is used in trading according to another popular strategy – ” London Explosion “. With its help, on the chart, you can set some construction parameters, the so-called “Boxes”. What this “Box” represents in the strategy we are considering, you can see in fig. 1.
The principle of trading with that strategy is very simple. Based on the signals on the price breaking through the “Box” borders, traders decide when and in what direction they can open a trade position. As you can see, the trading signals of the EURJPY Breakout Strategy are very simple. They do not require the trader to have any deep knowledge of the theory of stock trading. Using simple examples, we will analyze in more detail all the nuances associated with opening positions in one direction or another.
It should be said that the formation of a new “Box” occurs every day after 00:00 Moscow time. It is at this time that a new trading period begins, which lasts until 04:00 (also Moscow time). After midnight, the “Box” begins to form its range – this is the distance (in points) between its upper and lower borders. For trading this strategy, such a parameter as the size of this range is very important.
So, let’s take a look at the entire trading algorithm in order within the framework of the strategy we are considering:
- TF – M15.
- Currency instrument – EUR / JPY .
- The “box” is formed with a range of less than 45 and more than 15 points, which, according to the terms of the EURJPY Breakout Strategy , allows us to look for options for entering the market.
- We watch the price and wait for the first candlestick breakout of one of the borders of our “Box”:
- A breakout candlestick closed at the upper border – we enter with a buy.
- The candlestick broke through the lower border and closed – we are looking for an entry with a sell.
“Box” and signals for the breakout of its borders on the TS “ EURJPY Breakout Strategy “
I consider it necessary to draw your attention to the fact that our working range is limited by the size of the “Box” itself, measured in points. It is equal to a number in the range of 15 (minimum) to 45 (maximum) points. We work within this range of values. If a “Box” is formed by the “4-digit”:
- more than 45 points – you should not trade.
- less than 15 points, we also do not trade.
Size of the “Box” for trading on the TS “ EURJPY Breakout Strategy “
As for placing Stop Loss and Take Profit orders , there are no difficulties here either:
- We set Take Profit at the first target level in the direction of our open position.
- We always place Stop Loss near the “Box” border level, opposite to the market entry level.
Login with purchase
So, we have formed a new “Box” with a range of 29 points, allowing us to trade. Observing the price, we see how its first candlestick closes at the level of the upper border of our “Box”, and the next candlestick breaks it – at this point we enter the market by opening a buy position:
Entry by buy when the price breaks the upper border of the ” Box “
- We set Take Profit at the first target level in the direction of the trade we opened.
- Stop Loss under the terms of the TS is set for the opposite level of the box.
The Stop Loss to Take Profit ratio is 1: 1.
As seen in Fig. 3, the price is confidently moving towards the open position, which is closed by Take Profit. Frankly, I would have continued to hold this position after the transaction was moved to breakeven. I think that many traders would do this in order to make big profits.
Login with sale
The algorithm for entering the market with a sell on the EURJPY Breakout Strategy is the same as for an entry with a buy, but based on breaking the lower border of the Box. In this case, we are also initially interested in the formation of a new “Box” and the parameter of its working range:
As seen in Fig. 4, the “Box” has formed with a range of 30 pips, allowing us to trade. The lower “citadel” was taken first, after which we entered the market for sale.
- According to the rules of the strategy, we set Take Profit at the first target level towards the position opened by us.
- Stop Loss is set immediately beyond the opposite border of our “Box”.
The Take Profit to Stop Loss ratio is 1: 1 here as well.
The deal in this case, I think, could be held with its timely transfer to breakeven. By pushing back the target level, a big profit could be made here.
According to the rules of this strategy, if during the working day the price still could not reach a certain level, then the deal should be closed forcibly.
That’s all with regards to the rules of trading on the EURJPY Breakout Strategy system. We learned the rules of trading and considered examples of entering with buying and selling according to the rules of this TS. I think it was interesting for you to analyze this trading strategy with me. I tested it for 4 months and got the following trading result – my profit for this period was $ 4376 . Agree, for such a simple and uncomplicated strategy, this is a very good result.
Only the ” Sniper X ” trading system can compete with it , which can be traded without indicators, only “from levels”. It consistently brings good profit, as the students of the Forex Academy have already seen. Free basic training course ” Sniper X ” will give you the opportunity to take your profit from the market every day:
Do not forget to share with us your experience and achievements in trading with new strategies. We are waiting for your wishes and interesting suggestions. Share your trading discoveries with us, and we will try to look for new and interesting trading systems for you.