Nice week boys! 
I learned a lesson thursday night on my Oanda account i was a little late to the party on the early move so i was for waiting another chance at reentry.I notice the price was consolidating right after triggering the long so i went to 15 minute time frame and looked for solid movement up for reentry at the same time on another screen looking for a short on Eur/Jpy which did not materialize but had the trade set waiting for confirmation.Then GDP/USD started to move quickly changed screens on confirmation menu sent order in the price moved nicely.Looked at right corner of screen at p/L it was going in the red and fast:eek:When i changed screens i didnt take the short off when i switched currencys and in such a rush blindly sent order in(-18 pips) My saving grace was i decided to stay in Demo even though my account is set up.Lesson learned will go thru proper channels to send trade.:)I guess i better be locked and loaded when time frame lapses.I now stand at 3 winners 1 loser.Have a nice Sunday before the night heats up.
Recap of Friday morning:
The breakout Friday morning was early, haphazard and weak. The GU attempted an early breakout on the 04:05 GMT candle, stalled out 17 pips above the Thursday/Friday overnight HIGH, and retraced over the next hour and 50 minutes to just below the overnight HIGH.
Then, at 05:50 GMT, the actual breakout upmove occurred ā but, it was disappointing, topping out just 41 pips above the overnight HIGH.
If you entered a few pips above the HIGH, and had a modest profit target (say, 30 pips or less), then you did fine. If you had a more ambitious profit target, as I did, then you had several hours to contemplate your mistake, and decide whether to hang in, or exit manually.
I have drawn 4 boxes on the 15-minute chart, below. If you were one of the smart ones, with a modest profit target, then you were limited out in Box A. If you had a larger profit target, you probably moved into Box B, where you might have stayed for up to 5 hours, watching the pair try three times to break above 1.6575. If you didnāt give up and manually exit your trade in Box B, then you ended up in Box C, where you either exited manually or got stopped out.
Finally, at 13:15 GMT, the pair made its low for the day at 1.6473, and started a 260-pip upmove in Box D. But, that big upmove in Box D was not a ābreakoutā, as defined by our strategy, because it came hours late. Our strategy looks for a breakout from the overnight period within 4 hours, or so, after the close of the period ā that is, we look for a breakout by 08:00 GMT (4am New York, 9am London). If a breakout has not occurred by then, we should cancel our pending orders, and go on to other things.
I wasted a lot of time in Box B, watching the pair come within 5-7 pips of my profit target. Finally, I gave up, exited manually and settled for a small profit. Iāve decided not to play that game anymore.
Starting tomorrow, I will set a 20-pip TP, and a 30-pip SL. If this tests out well, then I will increase my position size to compensate for capturing fewer pips.
Platform changes:
This weekend, my FXCM platform will be updated to comply with the NFA (Nazi Futures Association) latest rules. The very simple, user-friendly order-entry procedures that Iām familiar with will become obsolete, and Iāll have to start using a more cumbersome procedure. I havenāt been able to try the new order-entry procedures; Iāve only read a description, and watched a video.
From what Iāve seen so far, it appears impossible to place both a BUY ENTRY order and a SELL ENTRY order, and to bracket each of those orders with a stop and a limit. I hope Iām wrong about that. But, if Iām right, then I wonāt be able to trade the Breakout Strategy without a lot of manual intervention.
If you guys are facing similar platform changes starting tomorrow, be careful with your live trades.
Iāll post analysis and charts Sunday evening.
Have a great weekend.
Clint
That was a huge jump up in price, any idea what caused it? News? or just because itās friday?
As you know Iām new, still on demo, but looking for the right broker to go live. I like your description Nazi Futures Ass sociation haha. Since Iām just beginning, Iām looking for a broker that wonāt be subject to NFA. I found this website where they rate a lot of different brokers if any of you are interested in taking a look.
Forex Brokers Reviews, Rankings, Ratings & Comparisons
I donāt endorse this site or know if their reviews are impartial or anything like that but maybe it will steer me in the right direction.
Well I just read through the whole thread and I really like this trading system and Iām going to see if I can make it work for me. Iām going to do some backtesting to find a R:R that Iām comfortable with. I look forward to contributing and reading this thread further.
Clint, I notice youāre using FXCM, Iām using them as well. Did you switch it over to the UK branch, I did for my Micro account and itās great, I love not having to use the OCO feature as well as having hedging enabled is nice.
[B]Letseethepips and ReaperKK, [/B]
Welcome to the Breakout Gang, as Mike (TalonD) calls us.
If you guys have carefully read this thread, starting at the beginning, then you have noticed that the very simple strategy originally developed by Trevor has been tweaked, modified and embellished by others (including me) ā and this may or may not be a good thing. Traders love to tinker, and weāve been tinkering. But, itās too soon to tell whether any of our tinkering has improved the original strategy.
For you new guys, I would suggest trading this strategy in its simplest form first ā go back to the first few posts on this thread to see the original strategy.
You will notice that it doesnāt involve candlestick analysis, indicators, Fibonacciās, or pivot points. It doesnāt even involve conventional trendline analysis, or support and resistance (those are things that I have added to the basic strategy).
Try the strategy in plain vanilla, first. Then, if you just canāt resist tinkering with it, knock yourselves out.
By the way, what do you guys want to be called?
No, I havenāt switched to FXCM (UK) ā yet.
Iām going to try the OCO procedures in the US platform first, and depending on how that goes, make a decision on UK.
Clint
[B]Hi Mike, [/B]
That list is out-of-date. The retail brokerage business of HotSpotFX, for example, no longer exists. They were bought by FXCM. The institutional side of that firm (called HotSpotFXi) still operates, catering to hedge funds, etc. Hereās a link to a January 2009 article on the agreement between FXCM and HotSpot: Finextra: Forex Capital Markets to buy Hotspot FX retail business
As for brokers in Cypress or Bulgaria, be very careful. [B]Due diligence[/B] is more important than ever, when you are considering non-US or non-UK brokers.
Clint
Thanks for the warm welcome Clint, Iām going to demo trade this with the rules as stated at the start of the thread and see where I go from there. Hopefully this something that I wonāt have to manage, ideally I want to work it out so I can set my entries and go to bed and have a decent R:R. Iām in the EDT time zone as well (Florida) and well I donāt want to micro manage too much but I donāt mind.
Will post results as I go!
Thanks Clint !This method his perfect for me, Iam a night owl from California.Tonights long move up i hope continues the down side might not come up till the New York session.I like to monitor all my trades except if i make a trade on a 4hr time frame.Thanks Trevor for your insight.
Iam so eager i think it is Sunday, my mind his in the wrong time frame.
Thanks Clint, I am a little leery of overseas brokers. Iāll try to find a reputable one. I may try Oanda since they have low minimum account requirements. But I think they are subject to NFA? Iām not sure how to do this breakout strategy with the new rules. The old way is so much simpler and more intuitive.
Since you have FXCM and are going to give it a try with the new rules, once you have it figured out then maybe you can explain here how to set up the orders for the breakout strategy so itās easy for newbie to understand?
Reaper
Sounds like we are in the same situation. Iām in Georgia. EDT so itās hard to stay up much past midnight edt when you have to get up for work in the morning. Someday maybe I wont have to get up for work in the morning 
Talon, I would imagine with FXCM what you would have to do (correct me if Iām wrong, Iām in the UK with them now) but lets say you wanted to set a buy position and then sell it 10 pips later so you would create an entry order on GBP/USD for 1.64600 and if you wanted to set your TP for 10 pips you would create a sell order at 1.64700 for the SAME amount of lots thus cancelling the buy order with a sell order in the opposite direction. You would do the same for for a SL, lets say your stop loss is 10 pips, so you would create a sell entry at 1.645000 for the same number of lots to cancel out the buy order.
So to recap;
Buy order of 1k lots at 1.64600 and a TP of 10 pips so a sell order of 1.647000
SL of 10 pips is a cell order of 1.64500
Hope this helps
EDIT: Clint, how do you do with this system on Sunday nights, market opens at 5 so Iām going to demo and check it out but Iām not really confident of Sunday trades.
thanks reaper. If I go with a US broker Iāll get used to it. just dont see why they have to make such changes. if it aint broke dont fix it.
speaking of doing this on sunday, there is another thread here called āsunday breakoutā itās on a 4h chart with a similar concept, but if it works there it should work regardless of time frame, price is price
[B]MB Trading has won the NFA FIFO Lottery[/B]
Off and on, over the past four years, Iāve considered switching to MB Trading, because I think their combination of STP and ECN order-handling protocols is the most honest and transparent of all U.S. brokers. But, I have always been put off by their klutzy platform and their bizarre order types (and, until recently, their lack of charts!). Well, now all U.S. brokers have to use an MB-type order entry system, or something very similar. So, MB comes out the winner, and all the rest of us end up losers.
My broker, FXCM, has been forced by the NFA to scrap their very rational and user-friendly order-entry system, and adopt an MB look-alike system. I had hoped that FXCMās new system would be adaptable to our Breakout Strategy, but no such luck. Itās going to be very cumbersome.
I spent an hour this afternoon placing entry orders, and linking and unlinking them as OCO orders, to figure out the best way to manage the Breakout Strategy. The results were not pretty. Then I had a long phone conversation with FXCM about what I was trying to do, and I was basically told that there is no nice way to do it, and I should move my account to the U.K. (which I now plan to do).
Until that transfer is completed, hereās what Iām up against (and you may be up against this, as well).
[B]1.[/B] We can place a Buy Entry order above the market, and a Sell Entry order below the market, as before.
In addition, we can link these two orders as OCO (one cancels the other) orders, which is something we COULDNāT do before.
That way, if one is triggered, the other is automatically removed. So far, so good. However ā¦
[B]2.[/B] There is no way to replicate our previous practice of bracketing our Entry orders with SL and TP orders.
If you place a Buy Entry order above the market, and then you place Sell Entry orders above and below your Buy Entry order (to function as TP and SL orders), here is what will happen: if the price moves down first, before your Buy Entry order is reached and triggered, your Sell Entry order (the one you intended as a SL) can be triggered, and you will open a short position. Then, if the price rises and reaches your Buy Entry order, your short position will be closed for a loss. If the price continues to rise, and reaches your other Sell Entry order (the one you intended as a TP), you will open a second short position. At this point, you will have booked one loss, you will be short in a rising market, and you will have no other orders pending. Not the way we want this to work!
If youāre stuck with a platform that functions this way, here is what youāll have to do:
[B]1.[/B] Letās say you decide to place both a Buy Entry order, and a Sell Entry order (above and below the overnight period). If your broker offers the OCO functionality, you should link these two orders as OCO orders.
[B]2.[/B] You must now wait for one of these orders to trigger, before you can enter a Sell Stop order (this serves as your SL) below your entry price, and a Sell Limit order (this serves as your TP) above your entry price. If your broker offers the OCO functionality, you should link these two orders as OCO orders. At this point, you can turn off the computer, and let your position run. When either of these two pending orders is triggered, your position will be closed, the opposite (OCO) order will be removed, and your trade will be complete.
I wish the news were better. I know that most of you want to trade this Breakout Strategy in a set-it-and-forget-it fashion,
but thatās no longer possible.
So, now all U.S. brokers have an order-entry system thatās as klutzy as MB Trading. I guess klutzy has won.
More later.
Clint
p.s. ā forex factoid: MB stands for Manhattan Beach (in Collie-fornia).
(I think Manhattan Beach Trading sounds cooler than MB Trading.)
Nothing changed on Oanda, I can place a long ābuyā and a short ābuyā at the same time with TP and SL, just as any other week.
See you later tonight.
If Long triggered short stays until either profit is taken or SL is triggered. Short remains until I cancel or it gets triggered to buy and then SL TP kicks in.
Yes, the only change Iāve noticed on Oanda is that if I open two longs on the same pair, they are now kept separate as two different trades. Other than that no changes, but then hedging wasānt possible before either with Oanda.
No problem at all with placing SL and TP along with trades.
I think that the real winners in this FIFO mess must be the UK brokers. Theyāre probably breaking open the champagne as Iām writing this. Iām a European, so hey, I donāt mind
Reading clints post makes me glad I switched to FXCM UK, Iām excited to try this out tonight and Iāll post my results later.
Sunday/Monday Overview:
On Sunday, we always have to decide whether to use the Sunday opening of the market as the start of our āOvernight Periodā, or include some of Friday. The 15-minute chart below shows the choice for tonight. The question is, Which of the two left-hand vertical green lines should we use as the start of the Period?
For myself, I choose the wider time Period (that is, I will include the end of the day Friday).
I have labeled the HIGH and LOW as ātentativeā, as the GBP/USD has been active so far today, and may yet expand its price range further, before the Period ends.
Is the GBP/USD confirming an ascending channel? You be the judge.
Resistance and Support (all of these levels are potentially STRONG resistance and support levels):
R 1.6919 ā 10/12/08
R 1.6904 ā 6/17/03 Swing High
R 1.6900 ā century point
R 1.6859 ā 10/10/08
R 1.6800 ā century point
S 1.6662 ā 6/3 high
S 1.6621 ā 6/11 high
S 1.6602 ā 6/24 high
S 1.6600 ā century point
S 1.6585 ā 7/23 high
S 1.6573 ā Friday 7/31
S 1.6561 ā 6/19 high
S 1.6555 ā Tuesday 7/28 high
Economic News Releases:
The FF Calendar for the coming week is shown below, edited to include only High-Impact news relating to the GBP and the USD.
Generally, news is released in Britain at 08:30 GMT. For those of us who actively manage (or sit up and watch) our trades, we should be out of the market before that time. For those who set up their trades and let them run (without monitoring), GBP news at 08:30 GMT (4:30am New York) can be hazardous to your position.
News comes out in the U.S. typically at 12:30 GMT (8:30am New York), and generally does not impact our breakout-trades (occurring between 04:00 and 08:00 GMT), with the exception of the U.S. Labor Departmentās Non-Farm Payroll Report ā which comes out on Friday of this week.
More about each of these reports as we move through the week.
For tonight, if you will be away from your computer (while an open position is running) after 08:00 GMT, be aware of the Manufacturing Purchasing Managersā Index coming out in Britain at 08:30 GMT.
The Halifax Bank of Scotland House Price Index (HPI) could be released any day this week ā they donāt announce the date in advance ā and will probably be released at 08:00 GMT, if they follow their recent pattern. This report can catch the market off-guard.
More in a couple of hours.
Clint
Edit: on the top chart, MONDAY >>>> should read SUNDAY >>>>
[B]Hi Oskar, [/B]
Have you chosen your entry prices already?
Which one of those LOW lines do you favor?
I favor the higher low, shorter range. Because it would trigger a sell sooner so you get more pips on a break down. the negative to that is the lower low may be some support to you might get triggered and then it turns back up at that low. But still the narrower the range it seems to me would be better.
The channel:
I think it will continue generally upwards. your chart shows 1hr but it looks more like my 4h chart. if you look at an even longer tf 1day itās been going up for a while and looks to me like it will continue for a while but then who knowsā¦
see the picā¦
p.s. donāt mind the multiple MAs, thatās just my typical clutter.
editā¦
In fact, I moved my upper boundary line down to 1.67480 not part of the official strategy I know but I like to experiment a little.
my lower line is at 1.67061
so I would place my orders the usual 6 pips above and below, I like Oscars tp & sl
edit again, another pic
yellow line = trend line
blue dotted= buy order up about 9 pips right now
red dottel lines = tp & sl
6am gmt, stopped out, picked the wrong direction and not even a break out yetā¦ thats what I get for not setting up things properly
