The Stairstep Breakout System
Today we will familiarize ourselves with the interesting weekly trading system, which raised many questions - The Stairstep Breakout S forex trading strategy. She has many adherents from all over the world who were fascinated by her simplicity and different from other TS. It can rightly be called a classic. The strategy differs significantly from others, since consolidation is the incentive to act. More importantly, this strategy was very effective and did not cause complaints.
Description of strategy
The trade strategy does apply to the classic because its rules are unchanged after many years. Often this happens that some parts of the system are replaced and kind of simplified. Out of a desire only to help things become very difficult, and adapting to the new rules is also not easy. The same strategy remained almost unchanged. The only thing that distinguishes the modern version of the strategy from the original is the additional myforex indicator in aid, which simplified the routine processes for the trader.
So, there are trends in the market and most systems are built on tracking them. However, the market is not always active and there are moments that are called the flash. This condition is familiar to all of us, as it is during these periods that many false signals appear. This is the most dangerous time for a trader. And it is such periods that this strategy tracks.
The author of the system has repeatedly noted that the strategy of The Stairstep Breakout System is similar on the principle of action to the patterns of Price Action. The calm happens when the bull and the bear agree on the price. However, this condition does not last forever and comes the moment when large demand or supply begins to appear, which affects the price and choice of position. The strategy under consideration involves a transition to action when the truce comes. You can move along an established trend or in the opposite direction, or you can just wait for an overrun in one of the sides. That is, the first step is to wait for the emergence of a consolidation zone. It is also worth taking into account its form. If the zone is very long, then it will be best to get out of it - it is the length and affects the force of the breakthrough. For example, the time frame М15 requires a length starting from 20 bars, and Н1 allows a good result at 10. Two middle Japanese candles are the normal height required at the side.
When weekly trading system on The Stairstep Breakout System with the help of the МТ4, the marks of the side bar zones on the graph are available - you need to go to the Insert menu and choose Shapes, then Rectangle. It will help with the mark. If you are not quite sure if there is a consolidation zone, you can skip the entry and wait for the correct view of the graph that will clearly point you to this zone.
For practitioners with graphical analysis, you can see the consolidation zone quite simply - it resembles patterns that are similar to the narrowing flag, triangle, and the like. In this case, we are not interested in the figures of technical analysis. It is actually quite difficult to decide on the flute area on its own, as everyone sees its beginning in their own way, and others can simply miss the entrance to it. An additional indicator to help is invented precisely for a hint in such cases.
Dynamic Breakout Box indicator
Installation happens standardly. The indicator is also very simple to run - it needs to be moved to a graph to make the required settings. The settings themselves are strictly individual each time.
For the duration of the consolidation zone, you can enter a value in the BoxLength line.
BoxTimeFrame is a string that defaults to 15 minutes and is defined as the time frame for the calculation.
You can set the height of the zone in the BoxRange bar, or you can use the AutoBoxRange setting to see how to adjust the height in the lull zone for the first time.
To set the value of the ADR period where the average value of the candle for a certain period is determined, mark this in the AutoBoxRangeDailyADRperiod line.
The height of the ADR multiplier, as a percentage of the volatility per day, is indicated in the AutoBoxRangeDailyADRfactor.
MinBarsClosedOutsideBO indicates the minimum bar value that closed before entering.
Select whether to show the information panel (ShowDisplayPanel), the level at which the profit (ShowTPLevels) is to be taken, or the level of the signal last applied (ShowTPLevelsOnLastBoxOnly) is indicated by the setting to "true."
The teak profit is also specified in the corresponding lines from TP1 to TP9, but by default the levels are set there.
The strategy indicator of The Stairstep Breakout System automatically finds the flute area, focusing on the displayed settings. There is also an indirect separation of this zone in the future so that you can see the price reaction.
Since volatility is completely different each time, a special value is required for each timeframe. If you select true for the AutoBoxRange, you can see the most common value.
Buffer zones are marked with horizontal lines. It is for them the price can freely enter. For example, for М15, the buffer can reach a size of 5 points and this will be sufficient. However, there are other TFs that require very different conditions.
In addition to the punch itself, the inputs to it, the indicator points to other inputs. For example, to retest the side bar level. I.e. The test is repeated and the buffer zone is broken again.
Rules on the entrance of The Stairstep Breakout System
You can log in when a consolidation zone and buffer break occurs. The sample begins to count not from the border of the box, it is necessary to focus on the buffer zone and the crossing of its borders. Besides, it is necessary to wait for two candles located outside the buffer boundary to close, which will serve as a kind of signal. You can enter in two ways: deferred warrants or market orders. The second is only available if you are constantly tracking changes on the chart.
One consolidation zone provides two entries, and it is better to make only one. It didn 't work out with the trade - you should wait for the next flute.
Loss Limitation and Profit Fixing
Profit fixing (teak profit) should be more than loss limitation (loss stop) by at least 10%. This rule needs to be adhered to.
You can set a certain fixed value on the loss and profit. If you see orange inscriptions, they indicate the points in what quantity were passed at the cost of the break last time. These inscriptions, when fixed, help to orient themselves correctly.
The summary on a system
The Stairstep Breakout System strategy is universal for any pair. Its operation can be easily checked. However, many notice that the result is positive. The main difficulty arises only with the setting of the indicator, but by catching and this can be done correctly. And the number of options in the settings allows you to account for each moment, as well as to set automatic settings to see how the strategy works in action. Reviews on The Stairstep Breakout System also show high interest in the system among experienced and aspiring users, and popularity confirms operability and relevance.