In this post I will be reviewing the Magic Breakout Forex Strategy. This is a manual forex trading strategy primarily to be used on the MetaTrader 4 trading platform. As the name suggests, it is a breakout strategy that puts emphasis on ensuring that losing trades are small and winning trades are big. This gives it an excellent risk to reward ratio and means that you can even be wrong with the entry more than 50% of the time yet still be profitable. It does not require a high win rate, but provided you pick the best breakout opportunities it can achieve an impressive win ratio. It is well know that when trading forex it is always wise to cut your losses short and let your winning trades run which the Magic Breakout Forex Strategy allows you to do as breakout can cause large movement in the market and when a breakout fails it because instantly obvious thus giving you the chance to get out before price continues to reverse.
Magic Breakout Trading Strategy
The Magic Breakout trading strategy is very easy to follow and has excellent money management foundations to ensure that it is a long term success. You do not see your wins wiped out by one loss and it can be used on any trading instrument and timeframe. Personally, I would recommend the major currency pairs such as the EURUSD and GBPUSD as they have more liquidity and bigger moves whilst also having the smallest trading costs. Furthermore, I would recommend trading on the higher timeframes, at least 1 hour and above as the breakouts are much more reliable than the whip saws you can see on the lower timeframes. The Magic Breakout strategy includes a combination of technical indicators that pin point the breakouts and filter the trend, ensuring that you only take breakouts in the overall trend direction. It gives you a good area to place your stop loss which is at a point where the breakout would have failed without having to be too wide and taking an unnecessary large loss. You can move the stop loss as the trade moves into profit, trailing your order and locking in profits. It also gives you a point of exit thus taking the guess work out of trading. Trend and breakout strategies are very popular because they work when used with good money management and filtering out ranging markets – as Magic Breakout does. It is very simple to understand and thus suitable for the novice trader whilst also being a very useful strategy for the more advanced trader.
Magic Breakout Summary
This is a very solid and reliable manual trading strategy that gives clear entry and exit signals. The indicators are easy to understand and it is very flexible as it can be used across multiple instruments and timeframes thus giving plenty of trading opportunities. The package includes a very detailed instruction manual with trading examples. It can be used stand alone and is good as it is without needing to add any more indicators to confuse things although you may want to further analyse the validity of breakouts with your own initiative and price action analysis – with consideration to current market fundamentals. It comes with full support, detailed instructions, propriety indicators for MetaTrader 4 and a 60 day money back guarantee. If you are looking for a ready to use out of the box trend and breakout system then I can highly recommend you visit the Magic Breakout trading strategy website for more information and trading examples.