Page 1

==== ==== Discover the Forex Breakout secrets they really don't want you to know at http://tinyurl.com/Forex-Breakout-System-X ==== ====

Introduction Forex breakout trading is based on the well known phenomenon in the markets that periods of very low volatility are followed by periods of very high volatility, and vice versa. Often, during the quiet periods, the price action will trade in a very narrow range, then suddenly "break out" of the price range with a rapid expansion to the upside or downside. Forex breakout trading can be very profitable if you get it right, because the price movements are so rapid and forceful that it can move 100 pips or even 200 pips in less than an hour. Challenges Of Forex Breakout Trading Obviously, as with any other Forex trading strategy, Forex breakout trading has its challenges for the beginner Forex trader. The biggest challenge with Forex breakout trading is to get the timing and the direction of the trade right. Getting the right entry price and the right exit price is easy, because there's such a big move involved. A 2-3 pips difference entering the trade is nothing compared to the 100-200 pip profit at stake. Timing the trade is difficult, because getting in too early means that you may not get the range limits correct, and getting in too late means missing the breakout altogether. Most breakout traders tend to get in too early, and end up getting caught in "false breakouts" because they weren't patient enough to wait for the range to establish itself fully. Another major challenge with Forex breakout trading is to get the direction of the trade right. Most breakout traders don't know how to do this effectively, so they try to hedge their bets by putting limit orders in at both sides of the range. This doesn't work very well in practice, because prices have a tendency to test ranges but still close within the range. That causes even more losses due to whipsaw trades and "false breakouts". Successful Forex Breakout Trading Successful Forex breakout systems have a few things in common. First of all, they don't try to trade every range setup. Not every range is followed by a breakout, and to be a successful breakout trader one needs to know how to save their capital for the best trades. Again, this is a matter of timing, and historically the best times to trade breakouts has been the London open. That's when all the European traders start their trading for the day, and the volume that they inject into the markets causes massive momentum moves that break the prices out of the range every single time. Another characteristic of successful Forex breakout systems is that they have a way of getting the


direction right most of the time. Obviously, there's no such thing as a "sure thing" system, but with the magnitude of the profits involved compared to the risk, successful Forex breakout systems can afford to get half of their trades wrong and still make a positive return. All in all, Forex breakout trading is an effective way of profiting from the Forex markets. Given that there are so many challenging elements of breakout trading though, instead of trying to reinvent the "wheel" of successful Forex breakout systems, it's a much better idea to buy one that has already been proven to be profitable. That way, you save yourself a lot of time, money and effort and jump to profits much earlier than you would be able to otherwise.

I've been a full time Professional Forex Systems Developer since 2007. Forex trading is my passion, which is why I really love helping anyone to overcome their challenges and become profitable in their own Forex trading. If you're just getting started in trading Forex, or if you'd like to take your trading to the next level, I'd love to help! If you want to start making real money in Forex right now, then you need proven, Profitable Forex Trading Systems. Here are some of The Best Forex Trading Systems I know.

Article Source: http://EzineArticles.com/?expert=Thad_B

==== ==== Discover the Forex Breakout secrets they really don't want you to know at http://tinyurl.com/Forex-Breakout-System-X ==== ====

Best Forex Breakout System  

Discover the profitable Forex trading secrets they really don't want you to know at http://tinyurl.com/Forex-Breakout-System-X

Advertisement