Breakout Trading – If You Want to Make Money Trading Forex You Must Master Breakout Trading

Breakout trading is a Forex trading strategy that can help you make money fast. It’s a chart-based strategy that makes use of technical analysis and is easy for beginners to understand. The idea behind breakout trading is to profit from a currency breaking out of a technical pattern like a trend channel or triangle.

Breakout trading is a fast-paced trading style that works best for day trading. If you’re an intraday trader, you may prefer to use end-of-day charts.

So how do you find breakout signals?

As a beginner, finding intraday breakouts can be difficult due to a short amount of time available for analyzing price patterns. But one of the most popular Forex strategies for breakout trading is the 9-minute opening range breakout trade.

The 9-minute opening range breakout trade looks at the high of the first 9 minutes of trading. Forex traders usually pick 1/3 of the amount of time they’re observing. This means picking a 3-minute candlestick.

When a full 3-minute candle breaks above the first 9-minute breakout high, this breakout trading method generates a go-long signal.

Once you know when to enter the trade, your next question may be when to exit the trade. The exit is discretionary here. Many traders use trailing stops to allow for profits to accumulate. However, one hard and fast rule is that if the exchange rate immediately drops back below the 9-minute breakout line, the position should be closed. You can enter the position again once the currency breaks out again.

That’s a brief introduction of breakout trading strategies for Forex. You can read about other trading methods online.

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