Flip Breakout Strategy

Strategy Overview

This strategy capitalizes on price action using easily identifiable support and resistance levels, alongside the daily and 4-hour opening levels. By combining these components with trading session timings, it aims to identify high-probability trades.

Strategy Idea

The strategy leverages volatility and volume spikes typically seen during session opens. Price often makes sharp moves, setting the tone for the day. The strategy focuses on breakouts from key support and resistance levels, with confirmation coming after a successful retest of these levels.

Strategy Timeframe and Key Considerations

This strategy is applied on the 15-minute timeframe, and you can expect around 2-10 trades per week. The most important aspect of this approach is strong risk management to avoid getting caught in fakeouts. Following the strategy’s rules is essential to ensure successful execution and to protect against false breakouts. By sticking to these guidelines, you increase the likelihood of capitalizing on genuine market moves while minimizing unnecessary risk.

Trading Assets and Times

The strategy focuses on highly liquid assets, such as GBP/JPY, EUR/JPY, and Gold, which tend to move significantly during key market opens (Frankfurt, London, New York, NYSE).

• Frankfurt Open: 08:00 CET/CEST
• London Open: 09:00 CET/CEST
• New York Open: 14:00 CET/CEST
• Comex Open (Gold): 14:20 CET/CEST
• NYSE Open: 14:30 CET/CEST

The strategy operates during two time windows:

• • Frankfurt & London Open: 08:00 - 10:30. CET/CEST
  • New York Open & NYSE Open: 13:00 - 16:00. CET/CEST
  • The specific market opens like COMEX (for Gold), and NYSE add volatility. CET/CEST

Bias Setup

• Key Focus: You start by marking the 4H open and the Daily open to establish a bias.
  • Above Both Levels: Bullish bias, look for buy setups.
  • Below Both Levels: Bearish bias, look for short setups.
• This bias helps filter out trades that don’t align with the overall direction of the market.

Example: The price is above both the 4H and Daily open, signaling a bullish bias, and you would only look for buying opportunities in this case.

Setup Identification

• Price Action: You wait for the price to break and close above a defined resistance (in a bullish scenario) or below a support (in a bearish scenario).
• Volume Considerations: Pay attention to the volume that aligns with the market opens (e.g., NYSE Open). This ensures that there is enough liquidity and momentum to back up the price move.

Example: The chart shows a clean break above a resistance level after the NYSE open, indicating a strong breakout with volume behind it. The next step would be to watch for a retest of this level.

Trade Execution (Retest)

• After the breakout, you wait for a retest of the broken level (support or resistance). The market may pull back to this level, providing a better entry point.
• When the price retests the level and shows a reversal (flip from bearish to bullish or vice versa), you take the trade in the direction of the breakout.
• Stop Loss: Set below the retest level, ensuring your risk is minimized if the trade goes against you.

Example: The chart shows price breaking resistance, then pulling back to test this level again. After the test, price flips bullish, which gives the confirmation to enter the trade.

Risk Management

Stop Loss

• Instead of having a rigid stop-loss, you scale out of your position if the trade starts going against you. This means reducing your exposure early on instead of waiting for a full stop-out.
• The key takeaway is to keep losses small and winners bigger. You will exit losing trades quickly while letting profitable trades run based on market movement and momentum.

Profit Taking

• There is flexibility in taking profits, as it depends on price action and your personal approach. For example, scaling out as the trade moves in your favor or targeting specific levels like previous highs/lows or key support/resistance.

This straightforward strategy centers around using market open, support/resistance breaks, and retests to identify trades. The emphasis on managing risk and adapting stop-losses as the strategy evolves allows for a more dynamic approach to managing trades.