How to Trade Opening Range Breakout with Trading Coach Greg McLeod 8 7 2013 20130807 103400 2320

and hello traders how you doing this is greg macleod with daily FX + education and welcome you to our webinar presentation of training outside of the box forex breakouts and it’s great to be with you here on this wonderful wednesday august 7 2013 as we explore the opening range breakout strategy we’re going to find out how to enter into the market how to place protective stops to protect loss and to how do to set targets for entry then we show you a couple of techniques to take advantage of this this popular way of entering the market of playing the breakouts so before we get started do a quick sound check and video check just to make sure that you can hear my voice and see my screen clearly and we go ahead and get started and so if you be so kind to help me out a little participate participation let me know that you can see my screen and hear my voice and then we’ll go ahead and put the risk disclosure on your screen make sure you understand all the risks associated foreign exchange trading and also the hypothetical performance enough disclaimer let you know that when show you some trade setups that did not guarantee any results past performance is no indication of future results and trading forex can result in loss so trading outside of the box for works breakouts and basically we’re looking at ranges very easily to spot type of formations they look like rectangles trading the rectangles trading looking at support and resistance but not just any support and resistance we’re looking at support and resistance as it occurs before the US market open and you can use it this for any type of market open whether it’s the US market open or the Tokyo market open or the Sydney market opened what you usually find is price prices will consolidate ahead of a major market open the currency market in in the case that we’re looking at but also if you’re trading stocks stocks will do the same thing futures will also consolidate before the market they will define ranges that will create these price floors and ceilings so again range break out trays are some of the easiest to recognize you can look at a chart you see prices and the tight range and a little rectangle or going across your screen and you can’t say okay there’s like a line of scrimmage if you’ve a big football fan if your Ras a rugby fan that line of scrimmage is where the opposing team’s line up on the line on and seeing who can push who off the line so we look at that opening range of that range breakout as that that line of bulls and bears whether facing off deciding where they can go so traders look for training opportunities to get long above the level significant resistance a price ceiling or short below a level of support called a floor now we want doing this type of break out we’re going to be choosing times of high liquidity and high volatility because we want those support and resistance levels to break what I have enough force behind them these moves to break out so we’re going to be using that we’re going to be in that overlap period between London and New York for this breakout because that’s what that’s when the New York oh it opens it opens up during that 930 period now we’re going to set up that range and i’ll show you how to set that range up by looking at a previous levels of support and resistance highs and lows are put in just before 30 minutes before that range is actually established so we’re going to go ahead and to do that so let’s go ahead and move on I get some of the benefits of the this type of trading is being able to establish a level of risk and a visible level of reward that is quite easily recognized okay now here’s an example of a trade i made during the ECB rate announcement and this was done in april of 2013 and you can see the way we set this up is by i would i do i start withdrawing two vertical lines one at 9am and one at nine-thirty a.m. eastern time so i cannot basically six candles or 30 minutes and i’m looking for the highest high in the lowest low during that 30-minute period because during this

time period your guard have what we call this price discovery price discovery i want you to say it with me price discovery and this is where the market is testing the floor to see where the buyers are where the sellers are and so you’ll see prices testing a low testing the high just before that that the major move of the breakout before the opening bell in this case we had price being tested down below at 28 128 25 on the euro and we had maybe not much of a test of the topside you know we can use this previous high that 2839 so 2839 2825 that basically established the high-low of the range this is this orange box and what I’ll do is I’ll extend that box into the future and that we can go ahead and what you’ll find is that once that ranged is established you’ll see prices either stay within that band or breakout and a number of traders a mark fisher George Brice there’s a number of carriers that have up told about this strategy and based on what their their research or their observations have shown is that thirty five percent of the of the trading session thirty-four thirty-five percent of the time the training session will make its higher low 30 minutes in the first 30 minutes of the trading session so either this will be the high of the session or the low of the session with this is where the low of the session we would see prices continue to move up and we probably won’t revisit these lows where this opening range is for a while okay or this may be the the the top of the market for the next for the next several hours were price breaks below this support area and continues down making this opening range the high of the day so once we break out it’s been noted that prices usually continue to move and trend higher away from this from this this premarket range and so in this case we did have a breakout and then price did the trail they move up to up an r1 pivot which is a a one-to-one so first of all it to look at getting into a particular trade like this there are a couple of methodologies and their love guidelines given but many times there’s not a particular exact way of hitting it some people use an ATR break out some there’s ways in which you can just buy the maybe up an entry put an entry or a by stop three or four pips above the high of that range so the range is 28 39 getting in at 2843 would get you in four pips and that would be your rule of entry that’s one way again that’s an aggressive move the problem with that low there’s always there’s a there’s a positives and negatives to each of these entry strategies the entering on the Fort Pitt breakout above the inch above the previous high is you could be it subject to whipsaw us and you might have a long wick that gets you get you into the market and then draws you back into the range so that would be a negative however if you catch the bottom here you can catch a big run if the run continues very sharply then guess what you got a really good entry you have your stop just below maybe four pips below the bottom of the range and you’ve caught a big line share of the move okay but you do risk the whip saw the other way of entry I know a number of you have talked about this as well and I talked with this with Jerry pan on the forums one of the members of the form and we looked at a pullback and I’ll look too we get a break out and you could wait and be patient and look for this range breakout this range pre-marketing this orange area to act as a floor or a level of support because once price breaks out price usually returns back to the scene of the crime and we get that double touch of that touch of that of the high or if prices break south we see a touchback of that previous low a return to the scene of the crime much like yeah maybe it moved out when you went to college in you and you were on your own but then you said hey no I won’t go back and live with my parents you come back in your room is turned into a mother’s a woman’s cave or a man cave or women’s din and our sewing room and then you have to move out again so this is like the kid moving away from home and coming back and finding the room already filled and it gets continues and moves on so we’ll see price come back and do that now given that you can place a stop just below that reversal you got a nice area of support and you have a confirmed move

that this trend will continue higher how but however there’s always good points and bad points there wait you also may miss a move where it doesn’t come back to return to the scene of the crime doesn’t come back to retouch the breakout channel and prices continue to move higher so again that’s the the pros and cons for waiting for that breakout to return back to the into the area of exit to enter the third way of entering this a trade is waiting for either to breakouts wait for that second break sometimes you’ll have a false wit to the upside I’ll pull back back to within the channel area and then prices jump out again and you will wait for a second move above or below the current opening range but that also has similar drawbacks to missing the move that totally moves this barrels forward and doesn’t look back and then you look back now I miss that trade but remember there’s always another tube leaving the station there’s always another train leaving leaving the station house as well another bus leaving the station so don’t worry there’s always another one don’t cry over spilt milk and the important thing is not to chase this once it starts moving up okay now you can use indicators as well for those false breakouts they know they can help you but they there’s no guarantees or there’s nothing really they can really protect you from a false breakouts that’s part of the load the risks of taking this type of trade okay so we basically looked at a couple of ways of entry look at taking profit the first profit I like trading in two unit increments or taking right trade and divide it in half taking one trade-off profit at the one to one and then taking out a second at my two to one risk/reward and moving my stop to breaking even on the first half of the trade so that would be one way so this or this green box represents a one to one based on the stop being placed below the range and getting long at the entry above the four pips above the the high of the range okay so the next the next arrow would be our maybe like one and a half to one and then there’s a I use of the Fibonacci there to look for some more for another part to the upside so that’s how we can look at taking profit and moving or having our stop just below the range because the range will either active support and if we break and stop out and we break below the range we may look to a possible reversal now I have a trade on right now we’ll see how it’s doing and let’s take a look at a real life example for a setup and and here we go this is our current setup that we have on the euro and currently is a down minus 3.2 pips we did get a break out and let me go ahead and show you the anatomy of the trade how I set it up and what I did in order to be able to see the high in the low between nine o’clock and 9 30 what I did was I created these up these vertical lines I just went to the blind tool and added a vertical line and instead of putting it at the nine o’clock candle because if the line covers the wick I’m not going to be able to know how big that how tall that wick is where that low is so what I’ll do is I’ll move my line to the candle before that make it like the 855 candle now i’m using a 5-minute chart I typically use the euro the euro USD and the reason being is that the is a very liquid pair it responds well to stock market moves have a high correlation to the US stock market open but you can use aussie dollar of the cable i did a breakout as well and we can see that i established the below of this candle let me see if i can zoom this in nice and big for you so you can see the anatomy of how i set this up in the very beginning what i’ll do is i’ll go ahead and set up i’ll draw a line at 855 look for that five-minute candle at nine o’clock and i would mark my my no mark mylow just look forward prices trending and i’m not doing anything all I’m doing is seeing price discovery we can see price coming back down testing this one spot 3294 area which we tested back here then price rallied up and again i’m not taking any tray you might even see prices this was a big blue candle hey so it’s breaking out right now usually these are just again

price discovery the market is trying to find out where the where the buyers are where the sellers are and establishing that range that high and low so we got that spike right there I thought at 9-930 and we came down 935 so I just move that over so that is where my range is defined by by these candles six candles 30 minutes 1 2 3 4 5 oh that’s there might not o’clock handle I can remove my mice I’m gonna move my thing right there are actually let me just leave it right there so you can see the size of the candle you can notice the wick you can appreciate the size and the wick showing that support area which I have highlighted with I this blue this purple know my colors they’re purple rectangle there we see support coming in right there we see the bounce and right there the tag and then we just moved sideways now here we get if we took a break up then this will be a false breakout we had a long week there and the another way of entering is waiting for a full body candle close and looking for price to way out of a closing candle like we had here we had a closing candle of this candle closed above this area here and so I would have used a a market order to look for that candle to close a moment the candle closed I got long and I was up a few pips and now we’re kind of drifting back down on top of the range there so which you’ll also find as well as about 10 am-3 p.m. gmt you’ll see the the European clothes of the European markets closing and you’ll see a big moves in the market as well now we see this pullback as it lies will drift back into the range and this kind of lackluster now we had some big moves in the euro up we had some good economic data and we saw the Euro move very strong along with the the British Pound because of a hawkish inflation report from the bank of england that was released this morning and so we did have a lot of of the ATR was it was already pretty much eaten up here in this big move we had a big move south a big move back up and sometimes we have a period of consolidation after big news announcements are big volatile move so the mark mark is basically catching his breath in this range and so after it maybe consolidates for a little bit we may get a resumption of our of our up move open now the addition you can just at first I just use just the price itself price is my indicator number one because remember all indicators whether they’re oscillators or MACD crosses or other things a they’re just derivatives of price and we want to be as close to price as possible however these can give us a clue of the bullishness of a pair we see that on this five-minute chart we do have the RSI above 50 and we did have this dip in this this wick and rs I came down below it as well but we didn’t close so we kind of drifted up we’ve got a nice little break out here at the the 1015 candle probably as a result of maybe positions squaring as European traders are heading home heading to the pub’s for the day and hidden and we see maybe their their orders they’re closing out their orders closing out there their cells with buys and the end is death we see that kind of momentary move there so right now we’re just hovering but you can see that I establish this if you just move this back in time this is where all this is all I had this is all we have during this opening range breakout we just have those six candles and we just established a range based on that box then we just move that box out and project that congestion zone that put that price discovery zone out into the future looking for the breakout and we did and look price hell that area so even though you know the market doesn’t know where this dotted line Oh Greg drew a green dotted line there I think I should stop and sit there no I’m not the only rocket scientist looking at this and so a number of traders are looking at this and so that’s what we’re seeing this support area actually holding because these things only work their self-fulfilling prophecies the only work of other people are looking at it and if

we’re drawing a line which no one else recognizes then we have a problem and I see Howard in there Thanks and the guest thanks so much I appreciate this congratulates and Gregor audio is not cutting out man great achievement that is a thumbs up thank you so much I really appreciate that Nino hello Greg when setting a limit order at certain levels fibs and let me finish your question neato hey neato hello Greg when setting a limit order a certain level fib pivot etc do you set that limit a little short of that level Thanks yes I do sometimes I like to well do is uh we put the my daily pivots i like using on my chart and out and let’s go and put those on daily classic pivots with ins on both sides and i also use the midpoint lines as well so I just choose a standard pivots there and you have to scratch them up a little bit of a scrunches price up because you won’t be able to see the end but you can see I did set a limit right there at the r1 actually have it on our one but up but usually i might having a pip or two below that hey hand good morning nice to see you in the room and yeah I’ll have that because you want two people are setting limits in that area you might want to get out a little bit early so I can just grab on the Dre from the chart go ahead and grab my my entry limit order and just bring it back a little bit up the pivot is like one spot 33 36 and maybe I can pull it down to like 34 okay and see if we kill kill will move up there now that’s my that’s my 121 price target that green box so I’m going to take off half my position at that at that green box now might I do have a more ambitious target that 3350 and so if we cannot get up to that I’ll bring my stop from say I have a I have a stop down here just below the wick and this range and so I’ll move that stopped I’ll just drag that up to break even on that second lot and see if we can get the rest so again and get stops and targets great question i use the range itself as my stop and now if i get a wick or something that comes below sometimes I’ll do is I’ll make up put up a couple of pips between me and those in that wick so actually that wicklow and I have that a little wide there I might want to tighten up a little bit but the low of that candle that penetrated the wick the penetrated the range the low is one spot three to eight and nine and I have I stopped at one spot 3285 so that’s about four pips below the low and that way if case price comes back down test this area I’m behind these guys right you know you’re like say yeah you want pick on me will pick up my friend that’s bigger than me i’m gonna get behind the the big guy so i’ve got the salt off selling a lot of buying pressure came in here at this 90 area i’m more buying pressure came here so I’m gonna step behind these guys and let use them as like a shield there you know so price comes back down yeah I deal with these guys first and have my stop buying there however if price gets past those two big guys then I’m gonna cut and run too I know I’d be the last one holding holding the bag of hot potato there so I like placing my stops below areas the this area of it was a significant area of support the penetration and the the rebound also is an area of of buying as well which all uses a shield so so you have to customize it that’s for me that’s what I do or you can just be a purist and just put it right there at that area by if it’s fine that prices may come back down and tagged a deer and retest it if it’s too tight on the range you get stopped out and then price is moving up in your favor okay so good question so again my my stop is the is the range itself this orange box my limit is the the the the height of that orange box so if i take the take that and you probably can’t see that the limits measurement about it’s about 20 pips and y12 when target takes me up i

have a target right there 1818 pips right there and then i look for another 17 or 18 right there ok so in fact i could just draw it korea another box to show you that other target that I have going as well and I green means you know well now the money is still light green but though i’ll use this other green here and so that’s my other price target as well so so again i take the range that’s my that is my stop and then I try to use a one-to-one for half my trade and then the other half let it go to break even as a stop and then look to try get that two to one target deaths just above hope that that’s clear any good questions okay and dave has a question and again thank you for your questions keep them coming this is when taking a break out will you take it in either direction or do you have a technical directional bias when only take the break in the direction ignoring opposite direction i’ll break out signals I I usually just go for the break out and just and just look for something like right now there’s an upward bias currently but we maybe we’re also i’m looking at the pivots we’re at r1 okay sometimes r 1 is like that can sometimes currency parents will stop at r1 typical range for a pair is like from s 1 to r 1 or s 2 2 r2 so i know that maybe my upside may be limited here I’ve seen prices break out to r 2 r 3 r 15 hour 19 s mama it can keep going higher and higher but so up i am i’m uh you know I’m kind of watchful that’s why I know have this double this double target if we do get past this r1 old resistance becomes new support and then we look for price to continue to move higher and so typically if we are are when if this if price does respect this area does turn around we could get a false breakout or breakout partway then price comes back down breaks through the trend line through the range and comes back through the bottom side of this and makes a nice short trade to enter on the short so I’ll play both sides of the range and how our dads will this be archived yes indeedy most certainly will you’ll be able to watch it as often as you want you can even if you miss any part of it there’s a I believe there’s a scroll bar which you can like a tebow you can scroll back in and rewind something that you missed okay so me move this over as well so here we go we’re at one spot 33 15 and we’re just kind of sitting right here at this this area sometimes you can break out this goes right to your limits you and you know wham bam and you’re in you’re out and you’re done and that’s a great trade sometimes we drift and drifting drift maybe to like 2 p.m. eastern time that is about seven o’clock at UK time so we get that that sideways drift and then all of a sudden we get this last-minute push later on in the afternoon okay so that is something that we can no we’re just staying above this area of the top of this range we’re just holding that so we may either we either hit it right away or we just can continue sideways sometimes though I’ll see maybe I’ll move at the 33 p.m eastern time which is you know a very very late you’ll see a ill just maybe the price will stay above this range or within this range and then just start moving toward the end almost like it’s just a marathon wearing wearing people out you know how you doing you get to miss the limit on euro and by two pips after later lost out live and learn oh yeah i feel ya I I had a short on cable he’s probably follow me on Twitter I got short out 1 53 10 I was looking for like 151 and moved myself to break even was up a hundred pips on that long wick McTell you take a look at that painful look at that but you know what stops work I want you know I want to tell you something stops do work and where is too ok so that that week there ok so and that was like early this morning we got

I got short and then we got this nice big drop this huge drop you know high five in my trading partner and friend Walker England yes Carney speaking Bank of England inflation report and then BAM turn around the upside BAM I am stopped out and not happy so but guess what if I was still in this trade and still short I would not be a very very unhappy at this point okay so remember the best laid plans you got consolidation without break out of a range I mean this was like the range break out the mother of all range breakouts we had this range break out here most little small one coming up into the in the European Frankfort open now this is the so here we go about the 33 we got the up this about the Frankfurt London open we got breaks outside and then this bad no big move here and let’s take out really round that and take a price project me about 90 92 pips on that move and so it was very quick I mean this is a 15-minute candle and you go down to a 5 and a candle you even go to a one-minute kennel and let me other size that up and just look how fat I mean each candles one minute this baby is flying and look at that that that’s a women at candle 5288 and be a week governor Carney was giving us Inflation Report and there you go this was a one minute candle and it just moved and let’s take a so we moved 88 pips in one minute no 90 pips in one minute and then the reversal and there’s a wicked wicked reversal there but there is your range and there’s your break then actually let’s look at the analysis of this breakout prices came and broke out South came back and retest at the inside of the other range and then we got a nice drop so we actually had a lot of opportunity you know what one two three four five is your five-minute clothes outside of the support we saw return the scene of the crime we solve this retest come back a one last push higher and then the the major drop and very sweet indeed if you were able to walk it out in time okay so let’s uh let’s get back where we are here we go this is again we’re again they’re opening range break out here for those people are just tuning in got the gut long here and I got long at those one spot 3318 and we got this breakout topside fast move pull back return the scene of the crime and now we’re about 2.8 pip so let’s see if we get some price acceleration we got our SI by the 50 and it looks like we’re picking up a little bit of speed after the close of the of the european bourses and han you can see I can see 12 pairs of my screen opening range on all 12 pairs why do you normally just look for euro I can well I have a I’m like a one-track pony I only use one win you know I don’t monitor all I try to be I’m like kentucky fried chicken I specialize in chicken over here we have the colonel sanders and i’m sure you have it around the world too they don’t have burgers they don’t have tacos they just have chicken and so the opening range breakout I primarily I just do euro euros my chicken so however you know if nothing’s going on I’ll look around but i find out that if i can grab 36 pips or 18 pips here on this opening range repeatedly in a regular matter i have a system and if i have a system then I’ve got a business and if I got business then I’m making money and so that’s basically what you want to do you combine something that can repeatedly give you a regular profit that’s fine now I’m going to get stopped out I’ve seen the whip saws and you get especially for getting around major news announcements sometimes you get a big whipsaw wink to the top side big lips off back to the south side and you know

you’re negative on the day but here I can identify the euro and I know that this is going to break out but if you see others I’ll feel free I’m we saw some an Aussie dollar up the pound yen and normally i’m training at home of the guy about I have full out four or five screens at home um I’ll have that I’ll have multiple pairs up and I’ll actually set alarms I might not necessarily have entry orders there um because i like i like actually executing the trade myself but I know people that actually will put they’ll they’ll put their entry orders in and their stop orders in and this to end just walk away and that’s uh that’s another another level of words what you feel comfortable with but it also takes a lot of the emotion out of it a lot of the guesswork out of it and so if you can discipline yourself or get to a point where you’re able to just set your limits and walk away that uh takes a lot of stress out of your trading and makes it more mechanical makes it more regular and got a business Dave good questions and Han excellent questions would you consider taking up side break when it returns oh no meat that’s a good question dave says would you consider taking an upside break then if it returns and break out to the downside taking that also yes I did I would definitely look at something like that where we because they would meet my rules where price is I get a close outside of the range then I get long and I’m staying with the trade now once I’m up I’m up and I hit my first target I know I’m going to bring that stop on that second half to break even now hopefully we’ll be able to break out of this range here we break this new high and we’ll go ahead and limit out and get some winner winner chicken dinner let lately we do a little top ramen noodles right now so let’s go ahead and see if we get a break out and we get the lobster dinner here so we’re up tattoo that one spot 3326 that was a high we saw back at ten-fifteen and we’re coming up on that level right now as we are closing in one spot 3325 and we’re challenging that top side resistance level as we narrow in and we see prices you know no I guess some other traders want some chicken dinner out there too so let’s see if we can work 4.9 pips 4.8 pips and looking for that break and we believe that there this probably stops above this area and we may get some type of a stop run which would carry this into some of a little short squeeze rally but again all that’s conjecture we don’t know for sure but just let price tell us where it wants to go and I’ll keep asking answer your questions while you are while we’re looking at price action and tati tops congratulations high five long dis is high five that you picked up 112 pips long on that pound dollar big congratulations to you and the pound dollar was a those that guess guess who’s buying dinner t-tops nice congratulations on that and hunt look very good very good I know that you use RSI to use this to initiate entry no basically this kind of looking at it either to stay above 50 to give me an indication that we’re worth that were bullish or if it goes above 70 and comes back down we could determine that maybe we’re we’re going to come down and so basically it’s like when you’re driving down the street you got your tech ometer and you’re seeing you know you’re you know how much how fast your engine is going and right now you know we’re above 50 so tell me that I know this engine little engines got a little bit of no get little going in and we’ll just keep that we keep looking at this long side okay so we’re up about six pips on this particular trade again one spot 3326 looking at the break of a high at the are 1015 high that we made that we’re looking at that high was one spot 3327 so we need 28 we get 28 we could probably see a nice roll into this area that of resistance up here where our limit is set we have a limit set at once about 33 34 to take half our trade off just short of this r1 pivot one spot 33 36 now another entry or a technique for the opening range break out which is not really a breakout is actually fading the opening range and usually you’ll see during Asia you’ll be able to use this on European currencies because you know the European markets are closed there’s not a lot of news that affects the European currencies there’s not a lot of trade volume during that asian session

so when you have these ranges sometimes you won’t get the breakout but what you’ll do is you’ll see price rallying up to the high of the range and then you look to fade that move and when in trading we mean by fading is taking a position in the market opposite direction prices going so if price is going up toward resistance we want if we wanted to fade that move we would get short at that resistance area with a stop above the high and look for prices to return back so if prices are moving up toward our top of our range we’re looking to or shorting and we’re looking for price to return back to that so we’re actually fading the breakout fading the breakout now in an active market like the US where you have up that this us New York and London European overlap you have a lot of volume about eighty-five percent of the volume is going through and so fading the moves may not be a wise show during this highly liquid time but but during Asia looking at looking to fade the moves and using your our size our side cross above 70 comes back down that can be a very useful another indicator that Linda rocky has talked about Linda Rocky is a in one of the market wizards and she uses the ad the adx indicator which you can use for range and we show you that indicator here the adx the average directional range determines the strength of the prevailing trend and it’s an oscillator and what it does and I don’t like that ugly little sand color it comes in let’s use a nice blue and click OK and make it a little wider so you can be able to see that indicator click ok now I’m seeing a DX now the other indicator that usually goes on top of the SAT di- and di plus and let me see if that’s in here at DMI yes and we click OK and location I want to put it on top of the deal I put it put it right here and click OK there we go so we have the di plus that’s light blue and the di- is red and the darker line we want to see in a range that it stays below 25 and usually means that we’re ranging and now this is not particularly healthy for our particular trade because on a breakout we would love to see this this ad exes trend strength to be above 25 to be 30 40 50 2 for us to get that extra momentum so we see it in 23 is actually in a range so this is an indicator we could possibly use now you can see in this case where we have a nice big break out here lots of blue candles break out on the the news we had that european news we had the factory orders actually it was the Shh yeah it was a trait of French trade balance earlier in the session and then that we had another number as well and we bring that up german industrial production okay i know i was like there’s a was a big number was 2.4% and so we got a big pop on that move at 6am and look at ad the adx indicator ATX above above that 25 zone above and so we weren’t we were in a range and then we broke out and then now we’re kind of moving sideways so that’s an additional filter that you could possibly use and looking for a breakout is looking for that that number this blue line to get above and stay above 25 moving toward maybe 30 40 50 or 60 right now it’s actually just shopping around below 25 and so notice how we’re not really making new highs we’re just kind of sitting around i have seen prices break out even though the adx indicator is below 25 so we’ll go ahead and see if that is uh we could see that move continue and move higher so again went 3321 we’re still up 2.9 pips kind of like watching paint dry but we’re still looking at this we’re still bullish

above this top of this range of one spot 33 15 again if you have any questions comments let’s go ahead and maybe look at some other parents do I look at and maybe look at the opening range as well t tops hey you’re quite welcome Howard Greg if you’re if you are great ugly heart rights Greg if your long slide short the euro dollar would you then also take another dollar base pair for example pound dollar those dollar weakness and your strength or which you choose a young pair Aussie cross well sometimes you’ll see like in the case of the euro dollar you’ll see the sometimes they’ll track each other like we have now which we have a bullish moving the pound bullish moving the euro and so basically you’re you’re going to be doubling up your exposure so if you want to diversify and diversify away from a dollar pair then maybe looking at a yen cross and maybe an aussie yen maybe a euro maybe like a like a nazi kiwi or something like that like we have aussie kiwi breaking out southbound as well and if we can see that we have a nice move we rallied up to level of previous resistance and now we’re heading back down and so if we were to maybe look for something on that might not be so sensitive to the opening range you know and uh but in fact let’s take a look this is so if you want to diversify we’re at aussie key we were not in any dollar or European pair and so we can set up our opening range let me show you how to possibly do that we could we we’ve got our 830 candle we can go all the way out and let’s see if it actually worked I have not not done that with this pair okay so I’m actually gonna put here at the we’re looking at the 30 minutes before sowing nine o’clock and looks like we are nine o’clock candle was here and our 930 candle was way down here so very wide range there so that didn’t necessarily would have worked out because we would like to see us a range established beforehand in fact prices actually channel before we did have a nice established support and resistance before beforehand and it can be something quirky with the other current particularly the currency pair which maybe if you study it maybe it does it over several days that it has repeated this pattern where it actually forms this range at nine o’clock ok so maybe nine o’clock eight o’clock nine o’clock we form our range first and then get our breakout and that’s a nice beautiful breakout I mean if we were to take that low we got a fake break out there we didn’t close below there we rallied up we didn’t come up to the top side of the range once by 31 nice doji candle you had some you had this candle close below you could have gone to get a cup of coffee come back and still been able to get short this pair your stop can been above this area let’s see what your stop would be if you have a stop on the other side and we maybe add four pips to the top side it bakes to spout bake like 20 and so we have a 14 pip stop 14 pip stop and look at that we’re and look where we have moved we’ve moved quite quite a ways from that and let’s say we’ve got a bad fill here 130 we dropped 33 pip so you got your two to one right there off that move and and then some before we gotta retrace so so there you go Aussie key we did range beforehand and then you could probably scroll back to see if maybe we did to have some type of a consolidation before move and that may be another ranging pair like our friend he will say there was 12 pairs or ranging and breaking out that was Han and thanks hon fort out for pointing that out that if you’re looking at other pairs that are more promising you can also do that look for that consolidation and look for that break just before market open and seems like the Aussie key we went a little bit earlier than but let’s go back to our trade and we’re still here 3.9 pips we’re hanging on there it’s better than a sharp stick in the eye is of course instructor used to say but we’re up about 3.8 pips and we’re still holding this level what and Johan how you doing which is what you got to say this is jana says are you using an app to color code ranges I’ve got a box of crayons oh I don’t I like I’m a sucker for colors and shapes

and so I do is I go up to this absolute market skill because I love they have these the color ranges you can go here and you can just create a rectangle like that and you can change the color you get a whole palette of colors you can do purple or magenta it’s not pink it’s magenta or dark dark blue won’t show up I just gotta keep it like a green means go and red means stop and orange kind of neutral but you can discolor in yourself be nice it’s something would do that something automatically could do that maybe that might be an idea for an app for the fxcm App Store Johan but yeah I drew the cut in that little purple boxes I drew them myself you know hen do you also use opening range for long-term strategies like the London open yeah I showed you that London open which was a pretty trade on the pound dollar which I took this morning and walked away with with a stop but it if i were there to kind of watch it and then i would have had that limit set I let’s basically thought there was gonna be a long term train and that the stop that made that save me I can keep up keep a positive spin like they’d saved me from losing a lot more pips that’s I have you oh stop stop loss can look at as regret but look at is it saved my account and it was a great job the stock did it was supposed to do and the platform did was supposed to do thank God for the stop okay and say we get why we got a lot of question you guys are really active sorry could you cover that again train both sides of the breakout in either way Dave yeah well I’m looking for is once I establish that range i’m basically looking for out of a candle close like is there’s three entries but you can use you can wait for a candle five min a candle close above or below a support resistance area that’s one area or you can look at a in the entry order you can use a buy stop or an entry order in this case above four pips above and have it do it automatically and it lets you get you in or you wait for a retest like for instance and we could have easily said hey you know what I’m not going to buy this on the brake on the breakout because the so many whipsaw is going on during the summer type training and look it came up and you’re like oh man i miss the move it came right back down and gave you another place to get in and now you’ve got a failure swing where price tries to make a new low the Bears try to fade this move and they fail to so we have a failure swing the failure swing is when bears fail to make a new low they’re trying to push prices back down to this area they were unable to when you see failure when you see one side failing that’s when you want to want to look at pouncing on the market when one side if you’re a if you’re a bowl and you see the Bears failing you take advantage of your weakness and take position if you’re a bear and you see the Bulls failing to a push-up then you look to take advantage of their weakness by attacking that failure swing again failure swings just an elbow just bend your arm and put your finger at your hand your elbow that’s a failure swing it’s a good thing because you wouldn’t want to have your arms hanging down to your feet all right so that din and there we’ve got a breakout above the high we’re at one spot 3329 and there you go you see that big run-up we know we’re hitting some clearing some stops out because prices are moving up let’s see if we can get some follow-through into our limit here that we have set that one spot 33 34 and there you go a little bit of fade back to the back to the south side nee nee nee nee nee nee ok let’s see if it up the Bulls can mount another attack look at ADX though down below 25 maybe we get above 25 we could probably see this engine kick into overdrive and take out our limit there okay and more questions hey Howard great if you’re doing and you hit your targets would you then go home no you said oh no would you then didn’t take a counter trend reversal you know they’ll say in the market no barriers get fed Bulls get fed but pigs get slaughtered there is an area here though um that one 3350 that I think if we closed about that we’re probably gonna run to 134 um I did there’s a air gap you guys talked about my Arabic air gap strategy where we got a big downward downdraft move prices come back and to fill the gap and so and I’ll go I’ll take I’ll show it to you like my work system one minute of time left and so

many questions guys you guys are great fantastic and it’s so great to be with you here on the DailyFX course but here is that big move down and you can’t see that candle me stretch that out there but that’s a big body cam I mean we went from one spot 3414 and basically didn’t find any support till you got back into this 1322 now we’ve just retraced all of that and I believe in the rule of symmetry a guide line of symmetry is not really a role but what happens on one side of the equation we got that big drop in the south side or on the side of the other chart and we look for a symmetrical rise in pips equal to that area on the other side though so I’m looking for that gap to get filled on the other side so we got a little symmetry and there we go we’re up 10.6 pips we did take out that high and now we’re moving higher what’s about 3329 and we do have the adx crossing above the 25 area currently at ADX is at 27.9 3 and let’s say we get a little bit of a stall but let’s see if we come back this was our high and tag that came back to test the scene of the crime again with that let’s see if we can get so close where one spot 33 34 that’s going to take half my position off that’s my one to one risk/reward there and remember you can if you can get one too once you’re going to even when fifty percent of the time and you can still be the game it’s okay now I’ve got to 212 I’m gonna get the best of both worlds if we can hit here I’m gonna bring that stop that I had down here I’m gonna bring that stop to break even and I’ll look for prices to uh I don’t try for that to the one target so hopefully we can not hit that area I’m going to keep answering your questions as long as you’re here I do have to go over to analyst on demand where i’ll be talking more about the markets so make sure you get you be part of our our leak group of traders are part of animals on demand had to go I you say hand ass or what about reverse breakout strategy because all I hear about his false breakouts well then we get these false breakouts we didn’t haven’t seen one here but then we would look at let’s say we got back down below this range and maybe you haven’t taken a trade maybe you say you know what Greg I’m just watching this you know i’m not sure what i do and you really haven’t even put you and pull the trigger on a trade and these that price comes back down between but below 130 315 that may be something for you to look at perhaps okay that may be something to look at again break out strategies there was risk involved is in fact you may take a lot of trades you know a lot of people talk about the turtles and their strategy and things like that but they took a lot of losses a lot of losses of false breakouts but the king is they have mechanical system where they took every single trait that they made and Mark Douglas talks about in his book the discipline trainer and training in the zone yeah that were there’s an example where if you had a machine that would pay you to one but you had to take the trade you had you know you had you’ll get paid to 2-1 on your tray but you have to take every every trade area or you have to pull the handle every single time okay and you have to keep feeding that that that that thing money kid can you survive 50 60 70 losing trades and the wrong before we before we actually come back to the upside okay okay okay so we’re going to go ahead and close out right now and I want thank you for being with me for this webinar we have David song coming up doing on Q&A and he’s gonna come up next so I want thank you for being with me today I have it any more questions come out to the DailyFX forms and let me give you my you can look at some of the my sample strategies and look in the contact me in the forums and that way I can clear the room out and let David go ahead and have this channel again stay tuned for his great presentation is great being with you have a great day and take care of cheese