Trade When its moving and not a moment sooner Break Out Trading

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What you can expect to learn

Three simple questions to ask before you place a trade What class as a range !ow to identify range trading opportunities !ow to assess them for potential !ow to trade a range break out "nd a few other surprises

Business #lan

Where $m now% Where do want to be% !ow $m going to get there% Where is price now% What is it doing% !ow can get involved% &remember there are ' trades
(ong) *hort + ,lat-

"ssessing for intraday potential

Ob.ective for day trading / an average days movement "T0 / average true range s there potential for movement on 123 cross rate%

"ssessing for intraday potential

What is a range%

" consolidation pattern 4enerically call most types of consolidations a range This keeps things simple 5on$t have to worry , have identified the pattern correctly 5on$t have to worry about the pattern developing into something else

What is a range%

Trend line + price action evolution

4enerically a range) evolution not a consideration now.

*kipping ahead too much now6 (ets back track

What is price action? What is a Trend% What is a range% !ow can identify which phase the market is in% When does price change from going up to going down% When price is making; !igher highs) !igher (ows / Trending up (ower !ighs) (ower (ows / Trending down #rice making 7either !igher !ighs !igher (ows or (ower !ighs (ower (ows / #rice is ranging

#rice "ction / Building (ayers on the chart

define a swing high as8 9 " three bar combination " bar preceded and succeeded by lower highs define a swing low9as8 "9three bar combination9 " bar preceded and succeeded by higher lows

When does the trend change%

" *hort or Bearish Bias :hange occurs when the following sequence develops. !!;!(;(!;((;(!9 The bias change is confirmed when price moves below the las lower low made as highlighted on the chart. "nother way of saying this is <=' reversal and you are trading the pullback as your entry trigger &0ed (ine-. There are a few variations of this pattern but this is quite simply a9price action bias change9in its simplest form. 9"9(ong or Bullish Bias :hange occurs when the following sequence develops. ((;(!;!(;!!;!(9 The bias change is confirmed when price moves9above the last9higher high9made as highlighted on the chart. "nother way of saying this is <=' reversal and you are trading the pullback as your entry trigger &Blue (ine-. There are a few variations of this pattern but this is quite simply a9price action bias change9in its simplest form.

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ntraday 0anges

The deal location for an overnight range is at>near the high or low of the previous days high>low. f price is consolidating in the middle of the previous days high>low range) this is typically indicative of continued larger range bound price action

ntraday 0anges

The overnight range is typically a consolidation period during the "sian trading session between <?pm and @am the following day &AB hours5on$t get hung up on price ranging between these times. The range can start a lot earlier and not break until a lot later than these times. $m looking for where the ma.ority of price action has been contained during this period of non trending activity.

ntraday 0anges

ntraday 0anges

deal 0ange

7on- deal 0ange

(arger Time ,rame 0anges

These can develop on any other time frames. use C? minute + =D? minute charts Obviously you can use larger time frames if you so wish. #atterns on these time frames would typically be considered for swing trading

(arger classical Time ,rame 0anges

Break Out 0ules

Trade the first pullback after the break out of the established range. *top loss goes past the event that caused me to get into the trade Targets and trade management for intraday trades are based on an average days movement taken form a <?? daily "T0 Targets for swing trading &longer term- ranges are the height of the pattern added to the break out point.

Break Out example

,irst pullback bar creates entry above the break out high

*top loss goes below the lowest point of retracement after the break out move was made

Targets based on average days move

Break Out example

Break Out example

Break Out example

Break Out example

Break Out example

Break Out example

Break Out example

Break out example

"ctive Trade Eanagement - "TE

,irst #riority / 0FEOGF T!F 0 *B trade in multiples of ' lots) will look to remove =>'rds at H?I of the siJe of the stop loss siJe.9 ,or example) f have a '? pip stop loss H?I of the stop loss siJe is <H pips) =>'rds of the position will be removed at K<H.9 The last <>'rd of the trade remains with its original stop loss level.9 f this last <>'rd gets stopped out then will have overall a break even trade.9 = x K<H L '? pips < x -'? L -'? pips #rofit on overall position f stopped out last <>'rds L ? pips

"ctive Trade Eanagement - "TE

"fter have scale out of the trade am then looking to lock in profits while at the same time give the trade the opportunity to fluctuate. Ey "TE 0ule is8 Once CHI of an average days move have been done The stop loss9allowcated to the9swing portion of the trade &where applicable- is moved to the entry point for the trade AND The stop loss9allowcated to the9intraday portion of the trade is moved to past the =nd previous swing high for shorts) swing low for longs.

What you should have learnt

The ' basic Muestions What class as a range !ow to identify a profitable trading opportunity !ow to read price action !ow to find an intraday range !ow to trade a range break out Ey trade management tactic !ow to lock profit in using "TE in a logical and mechanical way.

Thanks ,olks #lease Gisit www.trading-strategies.info to read all the information presented here Watch video presentations at your own leisure Or to simply ask a question / the only stupid question you have is the one you don$t ask. !appy Trading / #hil 7ewton