Which strategy tends to work well when trading breakouts?

From the School of Pipsology quiz on breakouts.

  1. Which strategy tends to work well when trading breakouts?
    Correct Answer:
    Jump in when volatility is low
    Your Answer:
    Jump in when volatility is high
    INCORRECT

From the lesson paragraph referencing this topic:

“With breakout trades, the goal is to enter the market right when the price makes a breakout and then continue to ride the trade until volatility dies down.”

How to Trade Breakouts in Forex

This implies that volatility is higher once the breakout starts. A breakout, in my opinion, is a rise in volatility. The notion that you can ‘jump in’ to anything while volatility is low, is silly, since there is nothing, yet, to jump into. You could do a straddle trade, while volatility is low, and automatically jump in when the breakout side is activated.

Maybe what the question was trying to say was that jumping into breakouts early is better than late, otherwise it could be too late, but there are better ways to say that then ‘jump in while volatility is low’.

So what I’m saying is this question is silly and needs to be reworded or removed.

Hi Clemmo.
I can understand your point entirely, I think the reason for what seems contradictory will come clear in the next few lessons when the school moves on to discuss fakeouts.
The problem with trying to pick breakouts during high volatility is that a volatile market can quickly change direction and run off in the opposite direction. A low volatility market would breakout incrementally, giving you more time to see whether it really is a breakout or not.
Hope that helps

I agree with Eddie.

(“Volatility” must surely be one of the most misunderstood concepts and misused words in trading, overall? For a start, its common meaning in a forex context is significantly different from that used in most other trading (and investment) contexts, which doesn’t help.)

Well that makes sense when you talk about a volatile market in general, but here are the lessons on fakeouts and the word ‘volatility’ isn’t mentioned in any of them. So what are the odds a new student would get that quiz question right, based on what they read on babypips? Better than random chance?

How to Trade Fakeouts in Forex

Fade the Breakout in Forex

How to Detect Fakeouts in Forex