Forex 4 hour breakout strategy that works

The next question is… Which Forex trading strategies suit you best? So before you attempt to trade any forex trading strategies, you MUST consider these 3 questions… 1. Do you want to grow your wealth or make an income from trading? This means you must trade the lower timeframes and spend more hours in front of the screen.

The Forex trading strategies you can use are scalping, day trading, or short-term swing trading. For wealth: If you want to grow your wealth from trading, you can afford to have fewer trading opportunities. This means you can trade the higher timeframes and spend fewer hours in front of the screen.

The forex strategies you can use are swing trading or position trading. How much time can you devote to trading? This is a no-brainer. Instead, go with a swing or position trading forex trading strategy. But, if you have all the time in the world and enjoy short-term trading, by all means, go ahead. Does this Forex trading strategy suit you?

Well, in terms of profitability both approaches can work because it depends on your win rate and risk to reward ratio. If you prefer a lower winning rate but larger gains, then go for position trading. Sell Trade Setup Entry A support line should be clearly identifiable. The R Gator lines should start to crossover and fan out with the red line below, the green line at the middle and the blue line above.

The MA Ribbon Filled indicator should start to crossover with the lime line crossing below the red line. The FBS Fisher indicator should be printing green negative bars indicating a bearish trend. A candle should break below the support line. These bearish signals should be closely aligned. Enter a sell order on the confirmation of the conditions above. Stop Loss Set the stop loss on the fractal above the entry candle.

Conclusion This strategy is an excellent working strategy to use during a trend reversal. The best way to use this strategy is as a confirmation of a trend reversal setup based on the traditional support or resistance breakout. This allows traders to filter out low probability trend reversal setups.

Another way to use this strategy is as a scanner. Charts and currency pairs that pass the conditions above could then be considered as a possible trend reversal if there is indeed a support or resistance line that is close to being broken. It is because support and resistance breakout trade setups simply work.

However, traditional supports and resistances are not the only areas where traders could look for possible breakout trade setups. Swing highs and swing lows are also good spots to trade breakouts. This is because swing highs and swing lows could also be considered as a horizontal support or resistance. Traders who traded on the reversal of a swing high or swing low would most likely have stop losses above a swing high or below a swing low.

Breaches from these points would often result in a strong momentum move due to these stop losses being taken out. Another advantage of trading on a swing high or swing low breakout is that trends could easily be identified just by simply looking at the pattern of swing highs or swing lows. Price action and naked chart traders would define a trend as a market with either a swing high and swing low that is constantly rising on a bullish trend, or a swing high and swing lows that is constantly falling on a bearish trend.

Traders who trade on the direction of the trend based on this assumption would often have a higher probability trade than those who mindlessly trade breakouts regardless of whether the market is trending or ranging. Zigzag Indicator The Zigzag indicator is probably one of the most underrated indicators. Even with its simplicity, it is still a very effective that traders could use to trade the markets.

The Zigzag indicator detects reversal points on the price chart whenever price reverses by a certain percentage as determined on the parameter. The indicator then connects these points with a line thus forming a zigzag like pattern. The reversal points that this indicator detects are very useful information for most traders. These points could be considered as a swing high or a swing low.

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