I'm trying to develop this new trading system, without the use of any indicator. I've called it Square Breakout. I would appreciate you precious help:
We could use every currency and, the number of pips used to compose the square should be choosen manually.
If we are using for example, EUR/USD on M15 TF, and we decide to use 25 pips - this is what it happens:
Define the center of the square on the last bar close - Draw a square with upper and lower border of 25 pips from the center.
The left and right side of the square should have the same distance from the center as the upper and lower sides.
But the square should engulf horizontally, "n" entire bars.
After we fix the square at the last close, we inspect if at any time there is any close bar outside the upper, lower side,
if any close crosses the upper side we enter long on next bar open (or close - configured manually), if crosses the lower side we enter short, if there is
no crosses, we displace the square to that last closed bar within the square, and so on.
After we enter the trade and if there isn't upper or lower crosses, we displace the center of the square to the last engulfed bar price open, within the square.
Our TP is the closing price (or next open) of the bar that crosses the upper or lower side (if we are long or short)
Our SL is the closing price (or next open) of the bar that crosses the upper or lower side (if we are short or long)
Meaning, we do not have either predefined TP or SL - the upper and/or lower crosses (close) will tell us that when needed.
If we are stopped due to TP or SL, we'll center the square in the next bar open or close (configured manually)
etc, etc, ...
PS: Could you answer to my Strange Pyramid latest request?