Forex breakout strategy.

RSI, stochs, MACD and all these indicators might work well for many, but I feel uncomfortable with them. I like something simple. I'm using something that has been working well, without any indicators, just strict money management.

All I need is to make 50 pips every week. With this system, if you look back at the charts, it's been achieved almost every week. There was about 4 or 5 times when it wasn't achieved in one week, but took 2 weeks, but still in the end the 50 pips was achieved. This is where strong MM discipline comes in to save the day.

*Time stated here will be in GMT+8.

I'll open the GBP/USD chart at 5 pm. I trade the breakout of the channel from 8 am - 5 pm pm. Usually I set up the trade at 3 pips away from the high/low. Stoploss 25 pips, target 50 pips.

If I set up the trade before 5 pm, it might be triggered by a spike when people go on a panic buy/sell mode after the news release. I'd rather wait until it settles down and I get to see the true direction.

Not to mention in some brokers, there might be problems of widening spread, orders not filled because of gaps, etc. I've never had these problems with GFT though.

I breakeven when it's 33 pips in profit. So far I didn't specify a expiry time for the trade, so I let it either hit the 25 pip SL, or 33 pips to breakeven. Once it reaches 33 pips, we don't lose either way. We either make 0 pips, or 50 pips.

So few things will happen:
Stop loss hit: 25 pip loss.
33 pips profit: Move to break even
- SL hit, 0 pip loss
- Target hit, 50 pip win.

I've learnt that trading defensively works best for me.

If no trades are opened at 7.50 (adjusted to 8.20) pm, I cancel all trades. Wait for proper set up the next day.

If I get stopped out, I do not re-enter the same day. I wait for a chance the next day, between 5 pm to 8.20 pm. I increase the lot size just enough to recover my loss the previous day. Some would freak out at this point because it's sort of a martingale strategy. Firstly, I'm not doubling up my lots, but 1.5 times. Because my stop loss is 25 pips, it's half of my target. If I lose, I need to make 1.5 times the next time to recover my loss and achieve my target. But this is not entirely the case all the time. I do have a table drawn out on how many lots I would buy on the first, second, third try etc, and how many pips I would set as target. I will gradually increase the target size so that I could keep the lot size low.

It needs to be a balance of manageable lot size, and achievable pip target. I would like to achieve my target in as little tries as possible, so keeping the pip target more achievable is very important to me.

Because of this semi-martingale strategy, I start off with trading 1% of my account. This leaves plenty of room for me to trade safely.

After I achieve my 50 pips for the week, I stop. No matter what.

This strategy might not promise as much pips as some other strategies, but for me this is simple enough to keep me happy. Indicators and such give me a headache, maybe because I can't understand it or it just seems like noise to me. Even very good indicators needs to be used with good money management, otherwise someone could just as easily blow their account.