Hook Breakout Forex Trading Strategy

The Hook Breakout forex trading strategy is designed to offer buy and sell trade signals from short-to-medium term breakout patterns.

These patterns are mostly identified by higher low and a lower high compared to the previous session (based on the timeframe).

Chart Setup

MetaTrader4 Indicators: KVO.ex4 (default setting), ronz_price_ma_candle.ex4 (default setting)

Preferred Time Frame(s): 1-Minute, 5-Minute, 15-Minute, 30-Minute, 1-Hour, 4-Hour, 1-Day

Recommended Trading Sessions: Any

Currency Pairs: Any pair

Download

Download the Hook Breakout Forex Trading Strategy

Buy Trade Example

Fig. 1.0

Strategy

Long Entry Rules

Initiate a buy entry if the following indicator or chart pattern gets displayed:

  1. If the Hook Breakout pattern gets formed (depicted by candles 1 & 2) around a known support level and price breaks above the high of the Hook Breakout pattern as shown by the horizontal line on Fig. 1.0, the sentiment in the market is said to be bullish, hence a buy signal.
  2. If the blue candle like body of the ronz_price_ma_candle.ex4 custom indicator forms somewhat below the candlesticks as seen on Fig. 1.0, price is said to be bullish i.e. a buy signal.
  3. If the silver histograms of the KVO custom indicator aligns above the 0.00 level within its indicator window, it is an indication that price is being pushed higher i.e. a signal to buy the pair of interest.

Stop Loss for Buy Entry: Place stop loss below short-term support.

Exit Strategy/Take Profit for Buy Entry

Exit or take profit if the following rules or conditions take precedence:

  1. If the candle like body of the ronz_price_ma_candle.ex4 custom indicator turns red, it is a signal that more buyers are exiting their trades, hence the need for an exit or take profit.
  2. If the silver histogram of the KVO custom indicator realign to form below the 0.00 level, an exit or take profit is recommended.

Sell Entry Rules

Enter a sell order if the following holds sway:

  1. If the Hook Breakout pattern gets formed (depicted by candles 1 & 2) around a known resistance level and price breaks below the low of the Hook Breakout pattern as illustrated by the horizontal line on Fig. 1.1, the sentiment in the market is said to be bearish, hence a sell signal.
  2. If the red candle like body of the ronz_price_ma_candle.ex4 custom indicator forms somewhat above the candlesticks as shown on Fig. 1.1, price is said to be bearish i.e. a sell signal.
  3. If the silver histograms of the KVO custom indicator aligns below the 0.00 level within its indicator window, it is a trigger that price is being pushed lower i.e. a signal to sell the pair of interest.

Stop Loss for Sell Entry: Place stop loss above short-term resistance.

Exit Strategy/Take Profit for Sell Entry

Exit or take profit if the following takes center stage:

  1. If the candle like body of the ronz_price_ma_candle.ex4 custom indicator turns blue, it is a signal that more sellers are exiting their positions, hence the need for an exit or take profit stance.
  2. If the silver histogram of the KVO custom indicator realign to form above the 0.00 level, an exit or take profit is recommended.

Sell Trade Example

Fig. 1.1

Free Download

Download the Hook Breakout Forex Trading Strategy

About The Trading Indicators

The Klinger Oscillator or KVO is a custom indicator developed by Stephen Klinger and is based on turnovers.

It shares a whole lot of similarities with the traditional MACD, but differs in the display of real-time imbalances between buying and selling pressures.

The ronz_price_ma_candle.ex4 custom indicator is an Exponential Moving Average based price candle.

The indicator allows for the viewing of Exponential Moving Average Indicator as price candle.

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