Do you fellow traders have any tips regarding to trading the London session breakout?
Lots of small variations on the London opening range break-out. You need to watch the London session for hours and days to form your own judgement on London price behaviour. GBP/USD is the classic choice. Some traders use the first hour of price action from 7am to determine their trade direction. Others use the Asian session’s high and low and set bracket orders to buy above and sell below. GBP/USD is prone to dramatic reversals - around 8am, 9:30am, 12:30 pm and 2:30pm especially, for various reasons.
2 Likes
I’m interested in putting Buy-stop/ Sell-stop orders on above and below the Tokyo box strategy. Only thing that I’m concerned about is that where should I put a SL? Any tips on that?
Again, the classic approach is to use the opposite boundary of the box. The Asian session is often flat and trendless so it is often not a massive pip count away. But as ever, there’s a reasonable argument for using the halfway mark across the box or basing the SL distance on entry +/- a multiple of ATR14.
1 Like
So I should put two stop losses. One on each side side of the box.
am I correct?
If you set one-cancels-the-other (OCO) buy and sell orders then yes, always set a stop-loss on each. I guess there’s no rule that the two SL’s have to be set using the same calculation - so if the buy order has a SL at the lower boundary of your set-up box, the sell order does not have to have one at the upper boundary, it could be some suitable level in between or it could be identified using ATR , it could even be well away from the box. That sort of thing makes backtesting very complicated and maybe unreliable.
If the orders are not OCO then they will cancel each other’s loss out but that caps your eventual gain. Demo it to see what happens.
1 Like
Excellent strategy that should work well. If feasible, use the ATR NUMBER on your chart
X 1.5 -2 which should keep you out of trouble, providing the % risk is within your manageable limits. The ATR is one of the best indicators for this trade whatever the normal price action…
1 Like
Best to look over the main strategy on a place like Youtube. It is a great souce. When i have traded it i have looked at the Asian session range and have then waited for it to drop below the low and then place a trade in the opposite direction