4 Crazy Price Action Forex Tips That Will Seriously Improve Your Trading!
4. Time Your Breakout Decisions Carefully
One element to a trading decision, is the timing.
I really don’t think many traders consider this, and just pull the trigger ‘in the moment’.
Depending on what time you evaluate, or make a decision to execute on a trade order – can be a ‘make or break’ factor if the trade succeeds or not.
There are many time-based nuances in trading price action, however in this segment, I am mostly focusing on breakout decisions.
Here is my industry secret…
Breakouts that occur in the Asia session are deceptive, very risky, and continue to have a high failure rate!
I speak from my swing trading experience, but this phenomenon would definitely seep into other trading strategies also.
What usually happens is this:
A breakout event occurs in the Asia session
When London opens, the breakout event has failed – then market then explodes in the opposite direction
The fix is simple. Wait until London opens before you make any breakout decisions!
If we know it’s prone to failure, then we can actually use this fakeout as a signal itself. In my opinion, this one should be left to experienced traders – but here is some food for though.
I call this kind of price action event the Asia session breakout trap.