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Which indicator is the best to measure breakout ?

phoneix888
Jun 10 2011 at 07:09
6 posts
Which indicator is the best to measure breakout ?

Some traders told me, support & resistance, but didn't say in detail;
some told MA cross line;
some said RSI 20-80;

What does indicator use in good successful break out system ?

PipGnostic
TheCyclist
Jun 10 2011 at 08:08
724 posts
None.

They don't work. Just draw yourself a nice support or resistance line and then realise that price doesn't spend a lot of time in the vicinity of support or resistance, it tends to bounce on it. So if you don't see volatility on your levels it ain't a level.

And once it's gone through wait for the retrace, take the second train, not the first.

Chikot
Jun 10 2011 at 09:19
2299 posts
It is clearn from the name. When break out occurs, price does not come back. It nis in very good scenario, otherwise, it still can visit previous s/r area to trigger more orders but then again, it stays above below s/r line. No indicators.

phoneix888
Jun 10 2011 at 10:50
6 posts
PipGnosyic & Chikot,

I plan to write EA to trade. By manual trading, I can easy to follow your suggestion in the MT4 chart.

However, it is difficult to teach EA for stimulating you idea.


Any point?

PipGnostic
TheCyclist
Jun 10 2011 at 10:55
724 posts
Use the fractal indicator then...it will do the same job.

So you wait for the fractal to draw and then wait for price to go inside the fractal, then you know if it goes through again that it's most likely breaking out.

phoneix888
Jun 10 2011 at 11:10
6 posts
PipGnostic,

You are so professional and familiar with Bill Williams' theory !!.

Your suggestion seemed positive. But fractal is difficult to determine sharp of rectangle for breakout dowwards or upwards.
Anyway, I will test it again this weekend. There is another indicator named 'Gator Oscillator'. How to use it?


PipGnostic
TheCyclist
Jun 10 2011 at 11:22
724 posts
I don't use indicators so I don't know. The only thing the fractal does is put a arrow on a high higher than the previous 2 bars and followed by two lower highs, the shape doesn't mean anything.

Just a high or low that needs to be broken.

Forex Anadova
Forexanadova
Jun 10 2011 at 11:55
186 posts

TheCyclist posted:
    None.

They don't work. Just draw yourself a nice support or resistance line and then realise that price doesn't spend a lot of time in the vicinity of support or resistance, it tends to bounce on it. So if you don't see volatility on your levels it ain't a level.

And once it's gone through wait for the retrace, take the second train, not the first.


Agree with PipGnostic, this is the only method that works for BreakOut, BUT, Breakout is not very reliable as a lot of times the signal is triggered and it is just a market spike. If you are going to trade Breakout, use tight SL and wait for candle close/Open.
There are indicators out there that will draw the lines for you, or you can do manual as I used to, it is a lot of fun.
Good luck.

PipGnostic
TheCyclist
Jun 10 2011 at 12:31
724 posts
Fun ?!

I've called forex many things, but fun is not one of them. More like a decade of pain and suffering.

speki
Jun 10 2011 at 12:49
735 posts
Well if you don't <i>have to</i> make money <s>gamb</s> trading, well it's a lot of fun actually. 😄
It's like anything ... if you take it too seriously, it's gonna hurt.

Surround yourself with people whose eyes light up when they see you and who have no agenda for your reform.
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