Trendline breakout is a simple but profitable system in Forex. You don't have to learn many indicators, systems, forex tools just to get profit. If we do discipline and consistent with trendline breakout we can get rich (sorry to say this but its true). But, trendline breakout has many fake outs that can wipe out our account. Here I want to share a simple system using trendline breakout with CCI confirmation. CCI only used to confirm the breakout. If both condition do not met, do not enter the trade.
Rule
- Price break the trendline up or down
- CCI must be higher than 100 level (for long position) or lower than -100 level for short position
Example for trendline break but CCI does not goes below -100
On the picture above, price seems to break the trendline but the CCI does not go below -100. The price still move up and make new higher high. Actually we can go short here and put our stop on the previous high.
OK now see the difference between those two picture. On the picture above, price break the trendline and we wait until CCI goes below level -100. Put the stop loss on the previous high and we get some nice green pips here.
