Breaker Blocks With Signals

The Breaker Blocks With Signals indicator is a powerful tool that aims to provide traders with a systematic approach to identifying breakout opportunities in the financial markets. By analyzing breaker blocks and retests, this strategy helps traders make more informed trading decisions. In this article, we will delve into the workings of the Breaker Blocks With Signals and explore how it can be used to enhance trading strategies and improve overall trading outcomes. By understanding the methodology and applying it effectively, traders can potentially gain an edge in the markets and navigate price movements with greater precision.

What is Breaker Blocks With Signals?

The Breaker Blocks With Signals indicator is a methodology used in trading to identify potential trading opportunities based on breaker blocks. Breaker blocks are formed after a mitigated order block and can act as potential support or resistance levels. The indicator aims to identify breakouts between the price and breaker blocks and includes swing levels to determine potential take profit and stop loss levels.

Breaker Blocks
Breaker Blocks

The indicator generates signals based on specific rules. For bullish breaker blocks, the opening price should be within the breaker block, while the closing price should be above the upper extremity of the breaker block. Additionally, the price should not have crossed the breaker block average since the previous breakout. Conversely, for bearish breaker blocks, the opening price should be within the breaker block, while the closing price should be below the lower extremity of the breaker block. The price should also not have crossed the breaker block average since the previous breakout.

The indicator provides alerts for each signal identified, helping traders stay informed about potential trading opportunities. The signals should only be considered during retests of the breaker blocks. Traders can use the corresponding Discount PD Arrays for short positions and Premium PD Arrays for long positions as potential take profit levels.

The indicator includes various settings that can be adjusted according to the trader’s preferences. These settings include the length of the breaker blocks, the option to use only the candle body for determining extremities, the use of two candles to confirm a breaker block, and the option to stop highlighting breakout signals after invalidation until reset.


The PD Array settings are related to the Premium/Discount zones. Traders can choose to set the breaker block only if point E of wave ABCDE is within the corresponding zone. They can also choose to show the premium/discount zone, highlight swing breaks, and display swing levels/labels and PD areas.

Overall, the Breaker Blocks With Signals indicator provides traders with a methodology to identify potential trading opportunities based on breaker blocks, breakout signals, and swing levels.

Breaker Blocks With Signals Strategy

The strategy suggests waiting for a breakout signal after a mitigated order block forms a breaker block. For bullish breakouts, the opening price should be within the breaker block, and the closing price should be above the upper extremity. Conversely, for bearish breakouts, the opening price should be within the breaker block, and the closing price should be below the lower extremity. It is crucial to ensure that the price has not crossed the breaker block average since the previous breakout.

Once a breakout signal is identified, the strategy focuses on retests of the breaker blocks for potential entry points. Traders should wait for price to retrace and confirm the breaker block with a pullback, as indicated by arrows on the chart. These retests provide favorable conditions for entering trades.

The strategy recommends targeting the corresponding Discount PD Arrays for short positions and Premium PD Arrays for long positions. These levels act as potential take profit targets. Traders can use them to gauge the potential profit or loss for each trade. The strategy also suggests considering the occurrence of price reaching the Discount PD Arrays as a logical setup to look for when using this indicator.


To manage risk, the strategy highlights the importance of considering a trade setup as invalid if the price closes above the 50% level. In such cases, traders should exercise caution and wait for another setup before entering a trade.

Buy Signal

Breaker Blocks With Signals Buy Signal
Breaker Blocks With Signals Buy Signal
  • The opening price should be within the breaker block, and the closing price should be above the upper extremity of the breaker block. Additionally, ensure that the price has not crossed the breaker block average since the previous breakout.
  • Wait for price to retrace and confirm the breaker block with a retest, as indicated by a green arrow on the chart.
  • Traders may open a long position during the retest of the bullish breaker block, using it as a potential entry opportunity.
  • Place a stop loss for the position a few pips below the entry candle or according to your preferred money management strategy.
  • Close the trade if the price closes above the 50% level, indicating the potential invalidation of the trade setup

Sell Signal

Breaker Blocks With Signals Sell Signal
Breaker Blocks With Signals Sell Signal
  • The opening price should be within the breaker block, and the closing price should be below the lower extremity of the breaker block. Ensure that the price has not crossed the breaker block average since the previous breakout.
  • Wait for price to retrace and confirm the breaker block with a retest, as indicated by a red arrow on the chart.
  • Traders may open a short position during the retest of the bearish breaker block, using it as a potential entry opportunity.
  • Place a stop loss for the position a few pips above the entry candle or according to your preferred money management strategy.
  • Close the trade if the price closes above the 50% level, indicating the potential invalidation of the trade setup.

Breaker Blocks With Signals Pros & Cons

Pros

  • Provides clear entry signals based on breaker blocks and retests.
  • Utilizes an objective methodology with predefined rules and criteria.
  • Incorporates support and resistance levels through breaker blocks.
  • Offers potential for capturing breakouts and trend continuation.
  • Allows customization of settings to suit individual preferences.

Cons

  • Possibility of false signals, leading to losses or missed opportunities.
  • Relies on lagging indicators based on historical price data.
  • Effectiveness may vary depending on market conditions.
  • Requires active monitoring of charts for trade opportunities.

Conclusion

In conclusion, the Breaker Blocks With Signals strategy offers traders a systematic approach to identifying breakout opportunities based on breaker blocks and retests. It provides clear entry signals and incorporates support and resistance levels. However, traders should be cautious of potential false signals and adapt the strategy to varying market conditions. By combining this strategy with complementary analysis and maintaining diligent risk management practices, traders can potentially enhance their trading decisions and improve their overall trading outcomes.

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