Strategy tutorial: Buying breakouts

Buying breakouts can be a strong strategy to buy into coins with momentum to the upside. StalexBot has a way to automatically buy breakouts. Find out how.

A breakout occurs when the price or the value of an indicator is higher than all previous values. An example of price breaking out is:

An example of a breakout on an indicator, in this case RSI, can be seen below. The same method can be applied to catch breakouts on indicators as on price.

First off, we need to create the most important tile of the strategy. This tile will determine if a candle is a breakout candle.

Drag a grey signal tile into the builder. Name the tile something along the lines of 'Breakout' for your own reference. Then choose 'Candle close' as indicator source on both sides.

Source A should be the normal candle close on the timeframe you want to catch breakouts on. Source B is a little different: we set candles back to 1, to reference the candle before the current candle. Then we select Source B to be the 'highest of the last 100 candles'. This will allow the signal tile to look back at all last 100 candle closes, and give us the highest.

We can now check with the 'Cross above' operator to know if the current candle crossed above the highest of the previous 100 candle closes. This could signal a breakout.

This signal now gives us our price breakout. We can attach a buy signal to buy the broken out coin:

You can decide to place a take profit % and stop loss % in the entry/buy tile. Keep in mind you can backtest this using the backtester.

The process is totally the same as buying on candle breakouts. Simply select the same source twice, but use candles back: 1 and highest of the last (x) candles on Source B. Then as operator, choose cross above, to catch the moment the indicator crosses above the highest value in the last (x) candles.