Avoid false breakout

[Kam Yuk Wong]

I am developing an EA to trade breakout, the risk- reward is 1:1 (I have tried different RR ratio  but they almost got the same result in the long term.)

How to avoid false breakout ?

It mainly work on XAUUSD, US500 on timeframe M5.

Thanks

Peter

[Conor Mcnamara]

There's a few things, you can either enter the trade and close it when false breakout is detected, or else use smart money concepts to detect institutional liquidity sweeps. Either activate a breakeven trigger if the price retraces by a certain number of points (or by a certain ATR volatility). or build a system which detects when the position went into profit by 8 - 10% and then back into loss. 

Sometimes a strategy is not about avoiding it, but going in it, and then intelligently closing in a small loss.

[Rajesh Kumar Nait]

Kam Yuk Wong:

I am developing an EA to trade breakout, the risk- reward is 1:1 (I have tried different RR ratio  but they almost got the same result in the long term.)

How to avoid false breakout ?

It mainly work on XAUUSD, US500 on timeframe M5.

Thanks

Peter

Filter only those breakout which hold and sustain above resistance or below support. Avoid those breakout which makes immediate engulf or hidden engulf after breakout, and filter those candle where upper wick > lower wick in resistance and lower wick > upper wick in support