If you look at a Forex chart, you will see big trends that last for many weeks or sometimes longer and if you can lock into them you can make huge profits but how do you do it and make big gains? Let's find out.
If you look at a currency chart you will see big trends but look closer and you will see how to get on them with limited risk. A closer look reveals that all big bull trends start from breakouts of resistance to new market highs and also, continue form them...
The way to get in on these big trends is to simply, buy good breakouts which have high odds of success but what's a good breakout?
A good breakout is one which has tested a level several times before breaking. -so how many times should it be tested? The answer is the more times the better, look for 5 or 6 tests or more and if these tests take place in time periods which are widely spaced apart in terms of time, that makes the potential breakout when it comes even better.
Stop protection on a breakout trade is easy - you simply place your stop below the level that has just broken, this gives you low risk and if the breakout is a good one, you also get great profit potential at the same time.
You can add some confirming indicators for your trading signals i.e. a couple of momentum indicators and the RSI and stochastic, can confirm if momentum is accelerating. These indicators are easy to learn and they add an extra filter to your trading signals.
Most traders don't trade breakouts, because they want to be perfect and predict market bottoms and tops but this cannot be done. Prediction is hoping or guessing and you won't win at Forex doing that!
While you miss a bit of the start of a trend when buying breakouts, you have the comfort of knowing, there is probably a lot profit to come. You are trading the reality of price change and in Forex trading, that's a timeless way to make money.
If you focus on buying big breakouts and holding them, you can make a triple digit profit in 30 minutes a day or less. Many of the worlds top trading systems use breakout methodology and you should too.
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