Crypto Academy Season 03 - Week 03 | Advanced Course - Break Retest Break (BRB) Strategy to Trade Continuation

Steemit Crypto Academy season 03 is going superb and we are happy to see the participation level shown by students in all three levels from Beginner to Advanced Level. It will provide an excellent opportunity to new steemians who want to start their journey in Crypto world and advanced steemians who want to take their crypto journey to another level. If you are taking part for the first time in this season, you must check the previous 2 weeks lectures to get some great knowledge.

Last week, I have explained MSB strategy that is effective to trade the trend reversal and I am very happy to see that most of the students picked the strategy. This week I am going to share another price action strategy that is called Break Retest Break Strategy (BRB) which will help you to trade trend continuation especially at crucial support or resistance levels. I will explain different aspects of the Break Retest Break Strategy and students will be able to understand the following from this lecture;

• Understanding the Trend Continuation
• The concept of Break Retest Break Strategy
• Trade Entry Criteria for BRB Strategy
• Trade Exit Criteria for BRB Strategy
• Example of Break Retest Break Trades on Crypto Assets

Understanding the Trend Continuation

You all might have heard that trend is your friend in the trading market and you must want to understand how to trade trend continuation. In a trend, the price will make an impulsive move and then pull back. The next wave will make another impulsive move in the trend direction and then another pull back. This pattern will keep on going in a trend until we get market structure break.

Have a look at this bitcoin chart on 1hr time frame to understand trend continuation. Priced made impulsive downward moves and then pull back and the trend kept going on.

The concept of Break Retest Break Strategy

Most of you know the concept of Support and Resistance as these were covered in the previous seasons of Crypto academy. These are basically the levels from where the price has rebounded and reversed. Generally, traders think these points are unbreakable and we should just sell at the resistance and buy at the support. This is not true in all cases because these points get broken in strong trends and price continues its movement.

This is where Break Retest Break (BRB) strategy will come in play and we will get in the trade on break of these points. These support and resistance points do not have to be at extreme highs or lows but they cal also be present in middle of market structure. I will explain the concept of Break Retest Break with illustration because it is very important to understand to determine your entry and exit levels that we will discuss later in the lecture.

BRB at Resistance Level
Price breaks through the resistance level creating a swing high point. It will then restest the resistance level and then again breaks the previous swing point. This is why I call it Break-Retest-Break Strategy and this price action pattern keeps happening again and again.

BRB at Support Level
Price breaks through the support level creating a swing low point. It will then restest the support level and then again breaks the previous swing point. This is why I call it Break-Retest-Break Strategy and this price action pattern keeps happening again and again.

Trade Entry Criteria for BRB Strategy

I will be explaining the trade entry criteria for both Buy positions and Sell positions. It is important to note that you can only place Buy trades in spot trading available on crypto exchanges. You can also sell crypto assets on margin trading or other platforms like Metatrader4.

Entry Criteria for Buy Position

1- Market should be approaching a resistance level and you should mark that level.

2 - Wait for the price to break through the resistance level and make a swing high point.

3 - Price should then retest the resistance level and start moving up again.

4 - Price should break the recent swing high point to make it a valid break.

5 - Now, you should take the buy entry just above the break of swing point.

ETH/USD chart on 5 minute time frame showing Buy Entry Criteria

Entry Criteria for Sell Position

1- Market should be approaching a support level and you should mark that level.

2 - Wait for the price to break through the support level and make a swing low point.

3 - Price should then retest the support level and start moving down again.

4 - Price should break the recent swing low point to make it a valid break.

5 - Now, you should take the sell entry just below the break of swing point.

ETH/USD chart on 5 minute time frame showing Sell Entry Criteria

Trade Exit Criteria for BRB Strategy

I am explaining the trade exit criteria for both Buy and Sell Positions. You should also set Stop Loss levels and Take Profit levels for both scenarion i.e. Profit or Loss.

Exit Criteria for Buy Position

1 - We should set a Stop Loss Level in case our trade goes in the wrong direction after entry.

2 - This Stop Loss level should be just below the resistance level price has broken.

3 - If the price crosses the stop loss levels, it means the trade setup is invalidated and we should exit the trade and wait for another setup.

4 - We Should Set Take Profit level in case our trade goes in the desired direction.

5 - Take profit level should be 1:1 RR (Risk:Reward) at least which means it should be equal to our stop loss level.

6 - I will recommend everyone to use 1:1 RR until they get good practice with this strategy.

7 - When price hits your take profit levels, you can book the profits ar exit from trade.

Exit Criteria for Sell Position

1 - We should set a Stop Loss Level in case our trade goes in the wrong direction after entry.

2 - This Stop Loss level should be just above the support level price has broken.

3 - If the price crosses the stop loss levels, it means the trade setup is invalidated and we should exit the trade and wait for another setup.

4 - We Should Set Take Profit level in case our trade goes in the desired direction.

5 - Take profit level should be 1:1 RR (Risk:Reward) at least which means it should be equal to our stop loss level.

6 - I will recommend everyone to use 1:1 RR until they get good practice with this strategy.

7 - When price hits your take profit levels, you can book the profits ar exit from trade.

Example of BRB Trades on Crypto Assets

I hope you have understood Break Retest Break (BRB) strategy along with its entry and exit criteria. This is a very simple strategy, especially for intraday and scalping trades. I am showing you some examples on crypto charts where the strategy has worked well.

Litecoin on 15 Minute Time Frame

This sell setup on Litecoin has worked really well to give an easy 1:1 profit.

ADAUSD on 1 Hour Time Frame

This sell setup on ADAUSD has worked really well to give an easy 1:1 profit.

Ripple on 5 Minute Time Frame

This Buy setup on Ripple has worked really well to give an easy 1:2 profit.

Final Words

• Break Retest Break (BRB) is price action pattern that can be used to trade trend continuation at important S&R levels.

• You can mark the important support and resistance levels on your charts and wait for BRB setups.

• There are certain entry criteria that you should monitor before taking BRB Trades.

• You should understand the trade exit criteria for both scenarios i.e. profit and loss.

• You can spot BRB trades on any time frame. Shorter time frame will provide you more setups but it needs quick decision making. My personal favorite time frame to trade BRB strategy are 1 hour and 15 minutes.

• You can take the BRB trade on any important support and resistance level even in middle of market structure.

• BRB strategy is very useful for intraday and scalping but it can be used at higher timeframes as well.

Homework Task

1 - What do you understand about the Concept of Break Retest Break Strategy? Give Chart Examples from Crypto Assets.

2 - Mark important levels on Crypto Charts to trade BRB strategy. Do it for Both Buy and Sell Scenario.

3 - Explain Trade Entry and Exit Criteria for both Buy and Sell Positions on any Crypto Asset using any time frame of your choice (Screenshots Needed)

4 - Place 2 demo trades on crypto assets using BRB Strategy. You can use lower timeframe for these demo trades (Screenshots Needed)

Rules

• Your homework post should have at least 300 words. You can write more but I want you to be specific about your answers and do not write super lengthy paragraphs.

• You must post your homework post in SteemitCryptoAcademy Community.

• Plagiarism of any kind will not be tolerated and result in severe actions against the offenders.

• Create your own charts and use only copyright-free images with proper reference if you have to use them.

• You can submit your homework post by 17th July 23:59 UTC. Any post submitted after the deadline will not be entertained.

• You must include #cryptokraze-s3week3 and #cryptoacademy among the first 5 tags.

• Members who are doing power down will not be considered for evaluation and grading.

• To be eligible for participating in Advanced Tasks, you must have 60 reputation and minimum 500 SP.

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