Breakouts are popular among forex traders. It makes sense right? When price finally “breaks” out of that support or resistance level, one would expect the price to keep moving in the same direction as the break. There must have been enough momentum building up in order for price to have broken out of the level, right?…
As you learned earlier, when a trend moves for an extended period of time and it starts to consolidate, one of two things could happen: The price could continue in the same direction (continuation breakout) The price could reverse in the opposite direction (reversal breakout) Wouldn’t it be nice if there was a way to know to confirm a breakout?…
Just like breakouts on your face, the nice thing about breakout trading in forex is that opportunities are pretty easy to spot with the naked eye! Unlike the former, you don’t even have to look in the mirror! Once you start getting used to the signs of breakouts, you’ll be able to spot good potential…
Breakout begins with eight rows of bricks, with every two rows a different color. The color order from the bottom up is yellow, green, orange, and red. Using a single ball… Oh snap! Wrong lesson! We’re supposed to be talking about trading breakouts, not playing Breakout! Sorry about that. Where were we… When trading breakouts in forex, it is important…
Volatility is something that we can use when looking for good breakout trade opportunities. Volatility measures the overall price fluctuations over a certain time and this information can be used to detect potential breakouts. There are a few indicators that can help you gauge a pair’s current volatility. Using these indicators can help you tremendously…
What are breakouts and how can I take advantage of them? Unlike the breakouts you might have had as a teenager, a breakout in the trading world is a little different! A breakout occurs when the price “breaks out” (get it?) of some kind of consolidation or trading range. A breakout can also occur when a specific…
Whenever Happy Pip goes swimming at the beach or the pool, she always wears her pink rubber ducky floaters. Whenever she trades retracements, she uses stop loss points. Pink rubber ducky floaters are lifesavers. Stop loss points are capital savers. As we said before, reversals can happen at any time. Retracements can turn into reversals without warning. This makes using trailing stops…
Properly distinguishing between retracements and reversals can reduce the number of losing trades and even set you up with some winning trades. Classifying a price movement as a retracement or a reversal is very important. It’s up there with paying taxes. *cough* There are several key differences in distinguishing a temporary price change retracement from a long-term trend…
Imagine this scenario. Price starts to rise. Keeps rising. Then it starts falling. And falling some more. And falling some more. And then it starts going back up! Have you ever been in this situation before? It looks as though price action may be rallying and a buy trade is in order. WRONG! You’ve been…
What is a range-bound market? A range-bound market is one in which price bounces between a specific high price and a low price. The high price acts as a major resistance level in which price can’t seem to break through. Likewise, the low price acts as a major support level in which price can’t seem to…