We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Mixed
Wall Street
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Mixed
USD/JPY
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • The #Euro has dropped through support guiding it higher from late-March lows, suggesting that the end of a corrective rebound has given way to downtrend resumption. Get your $EURUSD market update from @IlyaSpivak here: https://t.co/gpKowYNmGi https://t.co/CY7RuZf91s
  • What are a few of the common trading mistakes made by traders? Find out from @WVenketas here: https://t.co/Q3sPmP2rya #tradingstyle https://t.co/ayjehPGEeT
  • $USDCAD came close to taking out the 17-year-high just a few weeks ago, but this was followed by an aggressive pullback down below the 1.4000 handle.Get your USD/CAD technical analysis from @JStanleyFX here: https://t.co/aWmL2rlWzG https://t.co/cauVFdBxsd
  • Follow up: S&P affirms 🇩🇪Germany's AAA/A-1+ rating, outlook stable (BBG). As for PMI data, it painted a darker picture⬇️ Final print for services: 31.7, preliminary: 34.5 Final print for composite: 35.0, preliminary: 37.2 https://t.co/x2SESwo0zr
  • RT @NorthmanTrader: You need to click to expand to see this chart via @byHeatherLong https://t.co/tXd4T45FqS
  • #Dow Jones: The blue-chip index lags the S&P 500 and #Nasdaq 100 as Boeing continues to weigh on the Industrial Average. Get your market update from @PeterHanksFX here: https://t.co/Z495djPG07 https://t.co/3rTF8I3KBg
  • $USDMXN: A breakout above 25.44 will get it to a new highs. Get your USD/MXN market update from @PaulRobinsonFX here: https://t.co/KFRLmtBZsv https://t.co/Lo3bvThH0w
  • #Gold closed above the 50-day average providing a bullish signal. Get your $XAUUSD technical analysis from @malkudsi here:https://t.co/h3yVqIxwVc $gld https://t.co/0xqiCWFaml
  • Forex Update: As of 20:00, these are your best and worst performers based on the London trading schedule: 🇨🇭CHF: -0.31% 🇨🇦CAD: -0.43% 🇪🇺EUR: -0.48% 🇳🇿NZD: -1.00% 🇬🇧GBP: -1.03% 🇦🇺AUD: -1.11% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/ST3oKR8Kyt
  • Commodities Update: As of 20:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 1.81% Gold: 0.37% Silver: -0.36% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/tCzfLiJU9V
Scalp Forex Breakouts with Pivot Points

Scalp Forex Breakouts with Pivot Points

2014-03-26 19:00:00
Walker England, Forex Trading Instructor
Share:

Talking Points:

  • Pivots can help easily identify support & resistance levels
  • Traders should monitor R4 and S4 values for breakouts
  • As with any strategy, identify areas to exit your position

Trading breakouts is one of the most popular strategies available for scalpers. When a major level of support or resistance breaks, this momentum can provide scalpers opportunities to capitalize on new orders. Today we will look at scalping breakouts using camarilla pivot points. Lets begin!

Scalping with Pivots

Pivot points can be great ways to identify key levels of support and resistance for the day trader. There are many types of pivots we can use and in today’s example, we will use camarilla pivots added to today’s AUDUSD graph seen below. Key levels of resistance are denoted with a green line (R1-4) while key levels of support (S1-4) are denoted by a red line.

In an uptrend, such as the AUDUSD chart below, traders will want to watch for a breakout above resistance. As R4 is the last line of resistance this line is an opportune place to look for potential market entries. Let’s look at a sample setup.

Learn Forex: Support & Resistance with Pivots

Scalp-Forex-Breakouts-with-Pivot-Points_body_Picture_2.png, Scalp Forex Breakouts with Pivot Points

Breakout Entries

Once you have identified support and resistance, it is time to plan your entry. The most common methodology of trading breakouts is to set entries to buy a currency pair, in an uptrend, when resistance is broken. As well, traders can look to sell levels of support in a downtrend as price breaks to lower lows. This can be done using entry orders to enter the market as soon as price moves beyond one of these values.

Market orders can also be used to trade breakouts. This method is normally preferred by traders who have time to remain in front of their trading console and monitor their positions. Traders using market orders may often wait for one candle close to confirm a breakout prior to entering into their trade. Regardless of the entry method preferred, the objective is still the same.

Learn Forex: AUDUSD Breakout

Scalp-Forex-Breakouts-with-Pivot-Points_body_Picture_1.png, Scalp Forex Breakouts with Pivot Points

(Created using FXCM’s Marketscope charts)

Managing Risk

The last portion of any active trading strategy is to manage risk. When using pivot points, these pricing levels become fairly intuitive. When buying a breakout over R4, trades can be managed by placing stops under the R3 value. In the event that prices begin mobbing back through earlier levels of resistance, traders will want to exit the market at the first available convenience.

Once a stop has been placed, traders can then extrapolate their profit target. A simple methodology is to extrapolate a positive risk reward ratio of a traders choosing. This ensures in the event that the trade moves favorably profits are maximized, while cutting losing positions as quickly as possible.

---Written by Walker England, Trading Instructor

To contact Walker, email instructor@dailyfx.com. Follow me on Twitter at @WEnglandFX.

To be added to Walker’s e-mail distribution list, CLICK HERE and enter in your email information

New to the FX market? Save hours in figuring out what FOREX trading is all about. Take this free 20 minute “New to FX” course presented by DailyFX Education. In the course, you will learn about the basics of a FOREX transaction, what leverage is, and how to determine an appropriate amount of leverage for your trading.

Register HERE to start your FOREX learning now!

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.