Chaos Fractals Forex Technical Analysis and Chaos Fractals Forex Trading Signals
Developed by Bill Williams
A fractal is formed by three price bars
It is used to detect the bottom or the top.
Up Fractal- defined as a middle bar with two lower highs on each side (A- shaped)
Down Fractal- defined as a middle bar with two higher lows on each side (V-shaped)
Forex Technical Analysis and Generating Forex Trading Signals
Break Out Trading
The break out method of using fractals to initiate trades is to take trades based on the direction of a price breakout above or below most recent fractal.
If price breaks above the most recent Up Fractal enter long.
Stop losses should be placed below the lowest low of the most recent Down Fractal or second most recent Down Fractal.
Buy Signal Break Out Trading
If price breaks below the most recent Down Fractal enter short.
Stop losses should be placed above the highest high of the most recent Up Fractal or second most recent Up Fractal.
Sell Signal Break Out Trading