Break Of Structure (BOS) Strategy

Here's a trading strategy cheat sheet for fluid trades traders using premium and discount zones:

Break of Structure (BOS) Trading Strategy Cheat Sheet

Understanding Break of Structure (BOS)

• BOS refers to a price action pattern where the price breaks out of a previously established trading range or structure.

• It signals a potential trend change or continuation.

Identifying BOS Setups

• Use the SMC Pro indicator to identify well-defined breaks of structures.

• Look for a clear breakout of these structures, either to the upside or downside.

Entry Strategies

Bullish BOS (Upside Breakout):

• Wait for a clear breakout above the upper boundary of the structure.

• Consider entering a long position when the price closes above the resistance level.

Bearish BOS (Downside Breakout):

• Wait for a clear breakout below the lower boundary of the structure.

• Consider entering a short position when the price closes below the support level.

Exit Strategies

• Set a target profit level (e.g., 1-2 times the risk) and exit at least a portion of your position.

• Use a stop-loss order to limit potential losses (e.g., below the breakout level for long trades, above the breakout level for short trades).

Risk Management

• Start with small position sizes (e.g., 0.5-1% of your account per trade).

• Use stop-loss orders to protect against false breakouts or reversals.

• Avoid chasing breakouts that have already moved significantly.

Additional Considerations

• Monitor the stock's behavior and overall market sentiment throughout the day.

• Be aware of potential false breakouts or whipsaws near the breakout levels.

Remember, trading involves risk, and it's essential to practice with a paper trading account before risking real capital. Always start small and gradually increase your position sizes as you gain experience and confidence in your trading strategy.