How to Day Trade Forex Using The London Breakout Strategy (300+ Trades Backtested)
No better than luck
Small profit, too noisy to call an edge
- trades tested
- 1,071
- per trade after costs
- +1.93bp
- winners
- 44%
- years of data
- 14.7
London breakout on GBPJPY 1h (London time): the opening range is the high/low of the 04:00-08:00 candles; from 09:00, when an hourly candle opens at or below the range high and closes above it, and that candle's size is between 1x and 2.5x the ATR(14), buy at the next candle's open. Stop at the bottom of the range, target 1.5R.
The exact rules we tested
- 01Instrument: GBPJPY | Signal timeframe: 1h | Direction: long
- 02Session: 09:00-22:00 (Europe/London), positions may hold overnight
- 03No new entries after 22:00
- 04LONG when: (open <= or.high) AND (close > or.high)
- 05SHORT when: (open >= or.low) AND (close < or.low)
- 06Filter: (rng < atr_max) AND (rng > atr14)
- 07Entry: market at next bar open
- 08Stop: at the or.low (longs) / or.high (shorts) level
- 09Target: 1.5R (risk-multiple of stop)
- 10Where rng = high minus low
- 11Where atr_max = atr14 times 2.5
- 12Where atr_max2 = atr14 times 2