Today we are trading the DAX 40 (DE40) in the 15-minute time frame. We are using the strategy that I have titled “1 2 3 Break-out Strategy”
In previous videos and posts, I have explained exactly what to look for regarding the criteria and the setups that need to be in play for us to determine the correct entry, stop loss and take profit targets.
Dax 40 Breakout Trading Setup
This strategy uses a previous range that was set either in the previous day’s Asian trading market session or if the price was trapped in a trading range for longer, we use that range as our points of interest. It does not matter how long the price is trapped inside of a range because this strategy is simply a breakout strategy. So we have to make sure our range is determined before we can spot our break out.
I have also explained that we use the London session primarily to find our entry. Please note that If we do not find an entry in the London session, we then keep our eyes on the chart throughout the day as sometimes the entry can come a little later, and in some cases we even see it happen during the Yorkork market trading session.
Now, what is important to note is that ranges do not need to have perfectly horizontal support zones and resistance zones. We can have all types of Support / Resistance zones. Sometimes these zones work at different angles. As long we can see price respecting these zones and bouncing off of them for a minimum of two taps.
1 2 3 Boom!
I have called the strategy the 1 2 3 Break out strategy because I believe the best setups occur when we see three taps before the breakout. In the video below, you will see how I explain this.
Trading is very subjective and it is easy to make our eyes see exactly what we want. We can make any zone on the chart have multiple taps, but the trick is to use the correct levels where, with an objective view, we can see that the price has indeed bounced off of these zones.
The breakout candle should never be larger than 100 pips. I always like to make sure it’s less than 90.
My entry was at the price point of 12485.0
My stop Loss is 12580.7
My Take profit is 12321.4
Please watch the previous videos discussing this strategy so you can fully understand how to take advantage of it and decide if it is something that fits into your personality and trading style.
Hope you all have a good weekend.
The Vortex Trader
Prediction Analysis Overview Table
|Analysis Overview Information||Prediction Analysis information|
|On what market is this position based (Forex, Stocks, Crypto, Indices, or Commodities)?||Forex|
|What is the trading position identifier (Name and/or Symbol)?||DAX 40|
|Is this a Short or Long Position?||Long|
|Would this be considered a Short Term, Medium Term, or Long Term trade?||Medium Term|
|As a Short, Medium, or Long Term trade, which best describes the position (Scalping, Day Trading, Swing Trading, or Position Trading)?||Swing Trading|
|What Time Frame chart is the position based on (1-Minute, 5-Minute, 15-Minute, 30-Minute, 1-Hour, 4-Hour, Daily, or Weekly chart)?||15-Minute|
|Depending on the asset, how much do you expect it to move in price or percentage?||From Entry to Target – 1.3%|
|What ratio of risk to reward is this trade/position? Choose your appropriate target(s)||Approximately 2 to 1 Target 2 N/A Target 3 N/A|
|What were the technical analysis tools used? Tick the appropriate boxes;||☐ Chart Patterns ☐ Indicators ☒ Price Action ☒ Support & Resistance ☐ Trendlines|
|From the technical analysis tools and indicators provided, tick the appropriate boxes for the tools and indicators used to analyze the position;||☐ Ascending Triangle, ☐ Bollinger Bands, ☐ Candlesticks, ☐ Channel, ☐ Cup & Handle, ☐ Descending Triangle, ☐ Double Bottom, ☐ Double Top, ☐ EMA, ☐ Fibonacci Retracement, ☐ Flag, ☐ Head & Shoulders, ☒ MA, ☐ MACD, ☐ Order Blocks, ☐ Pennant, ☐ Rounding Top Or Bottom, ☐ RSI, ☐ Symmetrical Triangle, ☐ Volume, ☐ Wedge|
Disclaimer: The FSP probability score is derived from adding and subtracting the positive and negative aspects of the position and is not a definitive sign of how the trade will play out. FSP is not in any way a financial advisor