Trading GBP/USD

[eleanorkim]

Hey traders! I've got an interesting story to share about my recent experience trading the GBP/USD pair. I spotted a breakout, took a long position, and things seemed promising at first. But guess what? It turned out to be a false breakout, and I ended up getting stopped out. Talk about a lesson learned! It reminded me of the need to adapt to market conditions and be cautious of false signals. So, how do you all spot and handle false breakouts in your trades? I'm all ears for your trading stories and insights. Let's keep the conversation going!

 

[Paulina_wagner]

I look for confirmation beyond just the initial breakout. I wait for additional price action or indicators to support the breakout before committing to a trade.

 

[Komondar]

I read, that in this case, you can use appropriate stop-loss orders and trailing stops to help manage risk in case of a false breakout.

 

[Doomsinger]

First up, you can use additional indicators to get the confirmation of a real breakout.
Second, it’s impossible to get all the deals right, hence why we all recommended to use SLs.
So don’t get discouraged and try again. Look for the new breakout.

 

[Gholis]

I think just a breakout is not enough.
Sometimes I wait for more confirmations, like when the price will bounce off the level again, then I can take avdvanytage of it.
But another good advice would be to get the idea of bigger picture on higher tieframes. In this case you will reduce the risks of being stopped.

 

[Komondar]

I think just a breakout is not enough.
Sometimes I wait for more confirmations, like when the price will bounce off the level again, then I can take avdvanytage of it.
But another good advice would be to get the idea of bigger picture on higher tieframes. In this case you will reduce the risks of being stopped.

What other risk management techniques do you find effective when trading breakouts?

 

[Painskin]

I believe all traders have ever faced a fake breakout situation. It's an ordinary thing when you miss something in the analysis. I have managed to diminish the number of such mistakes but a more careful analysis, actually. It sounds very banal, but it's really like that.
You analyze volumes, you analyze the trend and look at what indicator tell you. This thing should help you, for instance, use RSI for overbought and oversold levels and check something from MAs and watch for their crosses.

 

[bigdolly]

I believe all traders have ever faced a fake breakout situation. It's an ordinary thing when you miss something in the analysis. I have managed to diminish the number of such mistakes but a more careful analysis, actually. It sounds very banal, but it's really like that.
You analyze volumes, you analyze the trend and look at what indicator tell you. This thing should help you, for instance, use RSI for overbought and oversold levels and check something from MAs and watch for their crosses.

As per my experience that many fake breakouts happen after news releases of when some important data becomes available that can trigger the move which is used by large market players to squeeze those who tried to trade the new information.

 

[VasilTodorov]

that is why you have to use set sl
even if you are 100% sure of your trade