[ad_1]
The breakout strategies I employ for both the DAX and to a lesser extent the DOW are absolutely fantastic when they’re on a roll.
When they are on that roll you can make a lot of money very very quickly.
Last year I made £20K in the space of about 10 days using this strategy.
I’ve outlined it in full below…
But they do have a habit of occasionally breaking down.
I’ve tried to find reasons for this breakdown.
One suggestion I’ve brokered is both the DAX and the DOW are less efficient when the VIX Index is falling because volatility is the key, and if volatility is being taken out of the market there’s more chance of a malfunction.
I outline that here…
Now I think I’ve discovered another reason the strategy sometimes doesn’t work.
This is relevant to both the DAX and the DOW.
If the breakout to the long side is at resistance at the Globex high, and not just prior hour’s high and low, it seems less likely to work.
And if the breakout to the short side is at support on the Globex low, and not just the prior hour’s low, it seems less likely to work.
I’m not saying it WON’T work, just the odds are a little less in your favour.
The market loves to bounce off the highs and lows of the Globex high.
This is what happened in both the DAX and the DOW today.
So, in future, if I place a breakout order in both the DOW and the DAX and see that either support or resistance is at the Globex high or low, I’ll reduce my position size by half on whichever it is at.
The other side of the position is fine
It could actually be that the reverse trade has a better chance of winning if the other trade is at…
[ad_2]
Source link