Biggest question: reversal or breakout?
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  1. #1

    Biggest question: reversal or breakout?

    Hi there

    in recent months I am working hard to identify it will be break out or reversal.

    I have build my strategy that works fine for reversals, but during US session
    there are nice break outs happens even no news and my reversals does not work on that
    session, except if prices moving near price average of 60 days - that is different story.

    I wantrf to learn to identify it and started using volume indicator.

    What do you recommend and use for break outs, guys?
    Also does thinkor swim better than MT4 platform?

    Tadas
    advert via signature isn't allowed edited by Gamer

  2. #2
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    the breakout and reversal can work together in giving traders the money. and the use of the volume indicators will trick you a little bit. try to use the fibonacci instead of the volume indicators and you will see a brighter trading results while trading your reversal and the breakout strategy in this business.

  3. #3
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    Quote Originally Posted by silverlady View Post
    the breakout and reversal can work together in giving traders the money. and the use of the volume indicators will trick you a little bit. try to use the fibonacci instead of the volume indicators and you will see a brighter trading results while trading your reversal and the breakout strategy in this business.
    I love to do trade with breakouts, to know about the breakouts trader should use trend line on the chart, first of all they should learn that how the have to catch the market trend, I don't have any complain with indicator's they are good to know about the trend, moving average is one of the best indicator to check that. Fibonacci is also a good tool to check the breakouts, better to test our trend learning capability in demo trading account first.

  4. #4
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    Quote Originally Posted by Earnperfect View Post
    I love to do trade with breakouts, to know about the breakouts trader should use trend line on the chart, first of all they should learn that how the have to catch the market trend, I don't have any complain with indicator's they are good to know about the trend, moving average is one of the best indicator to check that. Fibonacci is also a good tool to check the breakouts, better to test our trend learning capability in demo trading account first.
    They both can work together to make a good use of breakout trading system, fibonacci and trend line these are very popular in forex and a lot of trader's are using these two regularly in trading. I am using trend line plus moving average on the chart, I don't have much experience of fibonacci but I am sure that trend line and moving average combination also good to do trade with breakouts, price action is best from all but its not very easy to do trade with price action.

  5. #5
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    Quote Originally Posted by Khimi234 View Post
    They both can work together to make a good use of breakout trading system, fibonacci and trend line these are very popular in forex and a lot of trader's are using these two regularly in trading. I am using trend line plus moving average on the chart, I don't have much experience of fibonacci but I am sure that trend line and moving average combination also good to do trade with breakouts, price action is best from all but its not very easy to do trade with price action.
    Yes mam actually I use support and resistance to make a good use of breakout in trading, right now I am not using any naked chart or trend line to check that, I mostly like to grab the trading opportunities at the beginning of the trend, so I wait for the signal on moving average twenty breakouts mostly take place above of my moving average trading system so personally I do less trade with breakouts.

  6. #6
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    Quote Originally Posted by forexlearner View Post
    Yes mam actually I use support and resistance to make a good use of breakout in trading, right now I am not using any naked chart or trend line to check that, I mostly like to grab the trading opportunities at the beginning of the trend, so I wait for the signal on moving average twenty breakouts mostly take place above of my moving average trading system so personally I do less trade with breakouts.
    Well, try to clarify this sir. You claimed you use the support and resistance for your breakout, and that is normal, but you are saying you do not use trend-line to check it. Is trend-line trading system not support and resistance trading system? Please, let us know the strategy you use in getting your support and resistance.

  7. #7
    Breakout strategies are the worst strategies if went wrong. Market moves like this breakout or reversal. that is how the market moves. if you want to make money you must also accept this fact and make money with that mentality. Making money is not an easy thing to do.

  8. #8
    I also faced this problem when I am looking for a way to know if market will break a level or will reverse, I am not able to get a way that will accurately determined that, do I just wait for the price to do what bit want to do before I take action, if is is a breakout, I will wait for a good confirmation of breakout and if it is a reversal, I will always confirm it before I take decision.

  9. #9
    First try and understand that most breakout and false and breakout need a lot of confirmation before you trade it, breakout are unlike reversal, reversal are mostly true and are easy to trade with, you can confirm breakout with a trend changing indicator or wait for the price to move back to the breakout level and then confirming a reversal back to the initial breakout direction then the breakout is confirmed
    Always have realistic DREAMS!

  10. #10
    As for me, I prefer to trade reversal to breakout because most breakout are false and need a lot of conformation, and waiting for more confirmation will make you loss a lot of pips and the price even move very fast during real breakout and price may be too close to the next barrier when an entry setup is formed, but with reversal, i will always be trading in the direction of the trend an have a high profitability rate than breakout trading
    Always have realistic DREAMS!

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