a step by step guide to trading breakouts in forex
TRANSCRIPT
A Step by Step Guide to
Trading Breakouts in Forex
WHAT ARE FOREX BREAKOUTS?
• We have a breakout when the
price of a Forex pair
overpowers and eventually
breaks out of a specific
psychological level.
WHY TRADE FOREX BREAKOUTS?
• Breakouts often lead to new price moves and trends. In this manner, traders attempt to enter the market right when a breakout occurs in order to get in early on a potential emerging trend.
WHERE DO BREAKOUTS OCCUR?
o Supports or Resistance
o Time Highs or Lows
o Trend Lines
o Price Channels
o Moving Averages
o Chart Pattern Levels
o Fibonacci Levels
o Pivot Points
o Round Numbers
Price Breakout from Support Zone
REAL BREAKOUTS
• As a general rule, a candle wick beyond a psychological area is not a breakout. I consider a real breakout to occur only in situations when the price of the pair closes the candle beyond the level.
Real Breakouts occur with Strong Momentum. Watch Out for Wicks around Breakout Zones
4 Steps for Confirming Forex
Breakoutscc: Vox Efx - https://www.flickr.com/photos/39096030@N00
Ascending Triangle Breakout and Pullback to Prior Resistance
Strong Downside Breakout with Bearish Divergence
Check Out the “IN DEPTH”
Blog Post on this Lesson