Hi traders. When trading a breakout do you wait for a candle to close above the breakout level or do you enter as soon as price reaches the level and enter with a buy stop order in an uptrend?
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no
yes - my buy-stop is already there, a couple of pips/ticks above the previous bar, it’s filled when the price touches it
yes, almost always
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Thanks for the input flamingo.
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I prefer to wait for a candle to close above the breakout level as confirmation before entering the trade.
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what is it “confirming”, Preston?
why would it be a better trade because you happen to have set your chart-timings so that the price is above that line at the end of a candle rather than half-way through it?
highs and lows are objective and determined by the market, but where/when the candle closes is just something that you have told your software how to display - why is that better?
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It depends on the strategy. Its unrealistic to separate out one characteristic of a strategy for optimisation but to expect the others to remain unaffected in their own silos.
As a rule of thumb, if I’m looking for a trend-following position which extends across multiple bars, and the entry trigger pattern isn’t one that shows a lot of momentum, I would want to see at least one close on my side of the recent price action.
If I’m using a strategy that gives me a position I’m happy to exit as soon as a target is reached, even 1 or 2 bars later, and the entry signal show slits of energetic price movement, I’m happy just to enter on a breach of a trigger level.
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it depends but mostly no
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i do too. same here
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