Daily Break Strategy | Foreign Exchange EA Download- MT4/MT5 Resources

Hi dear traders,

I created and optimized this method and tested it before 2008 with good results. This is a very simple method that uses daily highs/lows as entry points and Fibonacci as take profit and stop loss points. Very simple.

Before introducing this method, I should remind you that you should definitely test it yourself before using it on a real account. Use proper money management to stay in the game and don't overtrade.

I don’t know if there is a similar system online. I developed this approach with the help of a client. Developing and optimizing the strategy required more than 200 hours of teamwork.

I will update this post as necessary after I see more questioning. It will become more comprehensive over time, so you don't need to read the entire thread if you don't like it. Just read the first article and follow the examples.

First I'll explain how to trade, and then I'll tell you the concepts behind it.

System properties:

Set your Fibonacci levels and descriptions as follows:

Level-----Description
0 ---------- Entries (%$)
1 ---------- Entry(%$)
-0.5 ------ TP2 (%$)
1.5 ------- TP2 (%$)
0.236 -----SL (%$)
0.764 ----- SL (%$)
1.25 ------ BE (%$)
-0.25 ----- BE (%$)
0.5 ------- BE (%$)

Now, adjust the Fibonacci between the previous day's high and low. As you know, the day ahead can vary from broker to broker. It is recommended to use 00:00 GMT, but due to my broker's time, I use GMT - 1 for my calculations. This is no different than 00:00 GMT. For a better view, you can plot Fibonacci on the M15 TF, but this will have no impact on how you trade.

How to trade:

Now that you know how to detect the previous day's high and low, let's start discussing how to trade:

This method has two types of entries, the first and the second. After I tell you what they are, I'll discuss the ideas behind them.

First entry : Buy 3 points above the previous day's high (Fibonacci line entry), stop loss is 1 point below the "Stop Loss" line on the Fibonacci tool. We have 2 TPs. One is when price reaches the "BE" line above the previous day's high (1.25 Fibonacci or -0.25 Fibonacci, depending on how you draw Fibonacci.), then you should close half of your position and place your stop loss on BE (place your stop loss at your entry point - no risk here). Your second TP is the "TP2" line on the Fibonacci tool. The opposite is true for short entries.

Second item : When you enter long ( after the input triggers ), you should place a sell order at your stop loss. The stop loss on your sell order is 1 pip above the previous day's high, and the TP1 (and of course the BE (break even) point) is Fibonacci 0.5, shown as the Fibonacci "BE" between the two "stops". TP2 is 1 pip higher than "Stop Loss" and is suitable for shorting. If the price reaches TP2, you must delete the order . The opposite is true for short entries.

** When the day ends, you must cancel all orders and place new orders based on the highest and lowest prices of the day.

** Avoid gaps. This means if your broker slips into an entry due to a gap, do not place an order on Friday's high/low. If the gap does not break through the high or low, I would place the order on Monday, the first trading session of the new week, rather than on Friday night. If it breaks, then I won't have an order on Monday.

** If the previous day's range was above 170, I would not trade because of overbought and oversold issues.

** If you have Sunday in your chart, combine Sunday and Monday. This means that if Sunday's low is lower than Monday's low, then the low for the Tuesday order will be Sunday's low, not Monday's. The opposite is true for the highs.

** If your transaction lasts until the next day, please do not make any changes. Stick to the previous day's strategy and place orders for the new day based on your open positions.

** It is preferred not to enter the "Second Entry" after the US Conference is over

You may be confused. It's not difficult. I wrote a program in Visual Basic for entries. First set your Fibonacci levels, then run the program and check the first and second entries. The spread for EU in this program is 2. I'm going to make some changes so that it works with variables using spreads . A few examples of recent transactions are shown below.

Useful posts:

Post #2
Post #48
Post #109
Post #542

The idea behind it:

As you know, daily high and low prices play an important role in technical analysis for short and medium term traders. So a break above this level could hit the target. But if the price does not reach the final target price (TP2), then even if the price reaches the BE point after breaking through the previous day's high or low, we can consider a false breakout and reverse our position. But if the price reaches TP2, then we will consider it a real breakout, which is why I tell you that when the price reaches TP2, you should remove the "second entry" order whether you are in the trade or not.

Pros and cons:

advantage:
**You don’t need to be a highly skilled trader to understand and trade this method.
** The maximum reduction from 2011 to now is 7% and has only occurred once.
** When the price reaches TP2, your profit will be a little more than 1 loss. (Sharpe ratio > 1)
** You can personalize TP to suit your own personality.
** Very clear approach. No self-judgment involved.
** Simple backtest.
** You average one trade per day, so if you trade greedily, you will be satisfied.

shortcoming:
**The main form is limited profit.
** It is possible to forget to place a "Second Entry" order on your computer. (will be solved by EA)
** Gap (The smaller the gap a broker offers, the better the results.)

Final words:

** As with any other method that works, it's not a "guru". You will also suffer losses. Like any other method, it has some advantages and some disadvantages. You decide which trading method to use. The average monthly return is 3% to 4%, with a risk of 1% per trade.

** Trade management is a skill you should learn through experience and a lot of trading. If you are not skilled enough (trading less than 2-3 years), do not change anything in the main method. If you are not a pro when it comes to live trading, stick with the main system. Do whatever you like in the demo, but don't jump to conclusions on a handful of trades. Any particular way of managing trades should be tested on at least a few hundred trades.

** The market is alive and its behavior will change over time because people's attitudes towards the market change. Therefore, some updates may be made from time to time to adapt the approach to the latest behavior of the market. This doesn't happen often, even though it may last for years. Don't get me wrong, this method is reliable. By "changes" I mean small things like changing the range limit from 170 points to 200 points or higher in more volatile years, or taking a larger TP2 if the market is trending, etc. It's not a big deal, but if you follow the topic, or even this post, I'll include all updates to it.

** I only use this on EU, which is the most technical pair.

** One more thing I think is also important if you guys know. Your results will be better if you don't adjust the SL to BE 1.25. But high profits are not the only case. When I want to design a strategy, I think about three things, not two. 1) Win percentage, 2) Sharpe ratio, 3) Losing streak. If you take profits at TP1 and move SL to BE, your worst case scenario will be much reduced. So you can take more risks and in this way you can increase your income and you will feel more comfortable if the system generates more income even if it is smaller. But like I said, you can increase your income by increasing the risk on each trade. Risks higher than 2% are not recommended.

** The important thing is that you can tailor the method to suit your personality, but pay attention to the main concepts and don't change them too much. For example, you can track TP2 any way you like, or change your partial shutdown management. I suggest you don't expand your SL. It's a good idea to make changes to the TP if you wish. But this setup is how I use it.

** Again, please backtest for at least one year before actual use. Start by paper trading for at least a few weeks. Don't worry.

** You can easily create an EA for this. Share it if you like it.

** I recommend using this only on EU unless you find something better on another pair. Using it on multiple pairs will extend your losing streak, and using the level on other pairs isn't as optimized as different pairs have different attitudes, but the main idea behind the strategy is still solid.

** Any good ideas or updates or thoughts will be highly appreciated and will be placed in this post to make the most of the main idea.

Have fun and trade safely

greeting,
busbell