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The Channel Breakout pattern

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by , 02-10-2018 at 10:22 AM (833 Views)
The global market is an age-old struggle between sellers and buyers. Sellers want to earn more by selling at a higher price, while buyers are not willing to give their earned money and want to pay a cheaper price. According to the theory of economics, the true price is found at the point of equality of supply and demand. That seems to be true. However, the problem is in the market dynamics, because the volumes of supply and demand are constantly changing.

The struggle results in price fluctuations. These fluctuations form channels, which traders analyze to find market trends. In turn, these movements form fluctuations of a higher order. One of the first signs of trend change is the breakout of a formed price channel.

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The very first test showed that the strategy is able to make a profit. The EA performed only 26 trades which resulted in 10 open positions during the tested period. 80% of open positions were closed with profit. This gave a smooth growth of balance. Profit-factor according to the testing results was 4.06. It is a good result.


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