Hey, SanMiguel
I’m not Trev, but I can point you to his first post on the subject of time periods: 301 Moved Permanently
5am London = 4am GMT = midnight New York
Yeah, I read over that but wasn’t sure whether he included the candle or whether it was old London time as in normal 5amGMT.
Anyway, something to lull over the weekend 
- I think it’s marginal either way - I actually use opening of London but there’s no real way to compare this strategy over the number of trades we’d need to prove one or the other…same as stops, they all work to some extent depending on what your flavour for risk is.
clint thanks for your reply. With the time difference it is getting confusing, I was 2 hours off as you said, so I will plot the lines to 2pm - 12:00am(midnight) EDT and that might of made a difference, i will check it out tonight as soon as get back home from work.
hey, I was reading your comment and I didn’t understand the part that you said ‘then make allowance for the spread’ what do you mean by that?
Charts usually show Bid prices not the Ask price. You Buy at the Ask, sell at the bid. So if you want to allow a 6pip buffer either side of the high and low you need to allow an extra buffer for the long otherwise it will be hit early. For example, the high was 1.0000. Assume a 3pip spread for GBPUSD. You allow a 6 pip buffer on the long so your order would be filled at 1.0006. However, this is when the ask price reaches 1.0006. At that time the bid on your chart would only be at 1.0003. SO, instead you add the spread to the long and your order is set for 1.0009. This is only for longs, you do not need to change shorts.
Excellent explanation, SanMiguel. You are absolutely correct on every point!
I couldn’t have said it better myself.
Hi all,
Thanks for this excellent thread. I am living in a region that is based on pacific time. So, does that mean I need to draw two lines between 11am to 9pm interval?
Also, is it true that we should ignore the 9pm candle if it makes the highest high/ lowest low (because we do not have enough time to see the strength of that candle)? How about the 11am candle?
Thanks
lalatony,
You are correct on the times. The [B]period we don’t trade[/B], called the “overnight” period, is 11am - 9pm PDT. At, or soon after, 9pm you will look for trading opportunities, anticipating a breakout above (or below) the High (or Low) of the “overnight” period.
I keep putting “overnight” in quotation marks, because for many of us the period is not exactly nighttime. Trevor (the designer of this strategy, who is in the U.K.) calls it the overnight period, and for him it really is overnight — it’s 7pm-5am London time.
But, I digress.
Back to your questions. Regarding the beginning and end of the 10-hour “overnight” period, think it through. If the 11am candle is the High (or Low) for the period, then maybe there is a resistance (or support) level prior to 11am that you should take account of. In the same way, if the last candle prior to 9pm is the High (or Low) of the period, then maybe the price is close to topping out (or bottoming out), and you should stay out of the market.
Scroll back to post #242 on this thread, where I posted one of my charts. The vertical green lines mark the “overnight” period (2pm-midnight, New York time), and the gray horizontal and diagonal lines were part of my analysis of the market at that time. Ignore the moving average lines — they aren’t part of this strategy. I had already placed entry orders, although the “overnight” period had not quite closed.
On this chart, the High for the period occurs just one hour into the period, and prior to the period there are two troublesome resistance levels just above the period High. These are marked by short horizontal lines. Because of those resistance levels, I didn’t place a Buy Entry order 6 pips above the 15:00 High; instead, I placed my order above the previous resistance levels, and saved myself a loss.
You can always scroll BACK from the 10-hour “overnight” period, but you can’t scroll FORWARD until several hours after the period has closed. That’s why a High or Low at the end of the period (9pm, in your time zone) is a special problem. Trevor says, just don’t place a trade in that direction. In other words, if the period High occurs at, or very close to 9pm, don’t go Long on that day. If the period Low occurs at, or very close to 9pm, don’t go Short.
Regarding which candles to include in the “overnight” period, for any time-frame you choose to use, the period includes the 11am candle, but not the 9pm candle. (The 9pm candle [B]begins[/B] at 9pm, and our “overnight” period [B]ends[/B] at 9pm).
As you can see from the chart I posted, I prefer a 5-minute chart (because I want to see as much detail as possible). This is easy for me to do, because I use FXCM’s MarketScope charts, which are extremely adaptable and user-friendly. If you’re using MT4 charts, or some other platform, you might find it difficult to get all the information you need displayed on a 5-minute chart.
Generally, for this strategy, it doesn’t matter which time-frame you use.
Just one more thing. Sundays can be a little different than the rest of the week. On some platforms, the forex market doesn’t open (on Sunday) until sometime after the start of the “overnight” period. In addition to the possibly shortened “overnight” period, there may be a gap on the Sunday Open, requiring careful evaluation on your part.
So, it’s a judgment-call whether to trade on Sunday. Try it, if you want to. You should be demo-trading, to start, anyway.
Welcome to the group.
Clint
Hi Clint,
Thanks for the detailed explanation! It is very helpful :D. I will definitely give it a try.
Thank you
guys if you are demo trading go ahead and see how this stratergy works for today the expeirance is good , if you are live trading dont take mondays trade there has been to much price action over the week end,
Hi Guys,
I’ve been following the thread over the last couple of days and as a newbie I’m finding it really informative. Regarding r/r startegies, surely Clint’s method has been proven to be the best option. You cannot argue with win/loss 11/0.
I think I’ll follow clint’s method of grabbing 10 pips for now. I’m London based so it will be an early start on Tuesday
Thanks for the trading education
Paul
The Breakout Gang… I like it! Reminds me of an old gangster… Now listen you mugs, we’re gona make a break for it see? yeah see? yeah!
Maybe the experienced among us like Clint or anyone else really, could post a nightly analysis, for example that resistance level having an effect on the buy stop order. For us newbies who might not spot something like that, it could be a good learning experience. And it might give the not so new, something to think about too.
My chart is a bloody mess tonight. I have drawn lines all over it, trying to decide whether a breakout looks probable.
Here’s what we’re dealing with:
(1) The Sunday opening, which looks different on every platform. Alpari’s MT4 platform opened with a large gap down, at midnight CEST (Central European Time), which is 22:00 GMT. FXCM’s MarketScope charts opened without a gap, at 4:35pm EDT, which is
20:35 GMT. If we use the Sunday opening of these two platforms, then the period High on the Alpari MT4 chart is 1.6314 at 01:15 CEST (23:15 GMT), and the period High on the FXCM chart is 1.6325 at 4:50pm EDT (20:50 GMT).
(2) A persistent down-trend throughout the “overnight” period, which is not the pattern we typically see during this period — but, it might be trade-able.
(3) Low price for the “overnight” period of 1.62585 (FXCM) and 1.6257 (Alpari) at 02:35 GMT (an hour and 25 minutes prior to the close of the “overnight” period).
(4) The closing price for the “overnight” period 15-20 pips off the Low.
(5) No major world news driving the market at the present time.
(6) No high-impact or medium-impact economic data releases scheduled over the next 24 hours.
(7) Nearby resistance and support levels, as follows:
R: 1.6420 on July 2 and 3
R: 1.6324 (previous support level July 2 and 3
S: 1.6232 on June 25
S: 1.6208 on June 15 and 23
I have decided to place a couple of Entry orders for tonight. But, this will not be a set-it-and-forget-it situation. I will stay on the computer until one of these orders hits, or until I cancel both of them. If one of them hits, I will actively manage the trade until it
hits my TP, or I close it manually.
Here are my Entry orders:
Buy @ 1.6345, SL @ 1.6315, TP @ 1.6355 (this Entry is based on Line 71 on my chart + 3 pips for the spread + 6 pips)
Sell @ 1.6252, SL @ 1.6282, TP @ 1.6242 (this Entry is based on Line 73 on my chart - 6 pips)
You will notice that I have drawn 3 vertical green lines on my chart. The middle one (at 16:35pm EDT) is the FXCM Sunday open. The right-hand line is obviously the period close. The left-hand line adds the last 3 hours of Friday to the shortened Sunday period. Given the way the market closed quietly on Friday, I think it makes sense to do this. So, I’m using a hybrid “overnight” period this time.
The short gray vertical line labeled Line 74 marks the Sunday opening on Alpari’s MT4 platform.
I’ll let you figure out the rest of the scribble on this chart.
If you decide to trade this strategy tonight, be careful. I have made a number of adjustments to the standard strategy, and you should be wary of trading my numbers.
Clint
Hi all,
[B]Part 1[/B]
I have downloaded a few platforms, such as Alpari UK, FXCM, and Interbank FX. However, each platform has a different pip value for each currency. For example, the pip value forr GBP/USD in Alpari is 1.63036. On the other hand, the pip value for GBP/USD in Interbank FX is 1.6303 (missing one decimal). So, does that mean when I put a stop loss of 30 pips, the outcome will be different?
Let say we bought at 1.63036 (Alpari) and 1.6303 (Interbank FX). If we set a 30 pips stop loss, the stop loss will be at 1.63006 (Alpari) and 1.6273 (Interbank FX). What should I do 
? Any help is greatly appreciated!
[B]Part 2[/B]
Trevpick001, I read your post earlier and you have mentioned that you are using a 5 pip trailing stop. However, when I open the Alpari UK platform, the minimium trailing stop is 15 pips. Are you doing the trailing stop manually?
[B]Part 3[/B]
One last thing! What’s a good platform for trading micro account 
?
Thanks
alpari use 5 digit’s your 15 pips actrully means 1.5 pip trailing stop for you to get 5 pips TS you need to change it to 50
because alpari use 5 digits (belive me it took me time to get used to it)
you may see another broker price look like 1.6230
alpari’s might look like 1.62302
what does this mean?
well all it means is that extra digit if you was betting �1 per point (or 1K Lot) you will notice you will have price increasment of not just pounds but pence as well, so if you won 3.2 pips at �1 per point you actrully won �3.20
Clint,
Thanks for the detailed commentary.
Trev,
I assume the logic behind your strategy is that overnight high and low become a support and resistance for the next day and we can captalise on any movement pushing through these and gathering momentum. If so, why cant we take any high and low from any recent period and use the same logic. What is so special about the overnight period?
Big move today, got +48 but could have been 100+
I had moved my short to below 1.6230 because of the support line so it was more of a scalp line trade funnily enough.
absolutly nothing special about it other than its worked for me quite well, there are 100’s of ways to form break out stratergy on the GBP/USD althought i would say i have had better results using this time frame, some people use the highs and lows from the previouse day others use a 2 hour box before london opens, i accidently come across this time frame messing around but from messing around to acttrully taking is seriously and live trading for 6 months i have done quit well of it, infact if for what ever reason it stopped working tommorrow based on my r/r ratio i would have to loose every day for 3 weeks before i rewinded the clock and was at the same capital as i started 6 months ago, trust me 3 loosers in a row and id go back to demo trading while i traded other stratergies.
so the answer to your question
there is nothing special about it other than it works rather well
at the end of the day thats all i wanted