London BreakOut Classic

The London BreakOut Classic indicator is a backtesting tool designed to automate and evaluate the popular London breakout strategy by identifying key Tokyo session price levels. It aims to help traders analyze the performance of trend-following breakouts occurring at the start of the London trading session.

Usage

The indicator visualizes the Tokyo session range and executes trades based on price action relative to that range during the London session.

• Tokyo Range Identification: The script draws a Red or Green box representing the high and low of the Tokyo session. A green box indicates a bullish session (close > open), while a red box indicates a bearish session.
• Trade Entry: A long position is triggered when the candle body closes above the Tokyo session high. Conversely, a short position is triggered when the candle body closes below the Tokyo session low. Only one trade is permitted per day.
• Exit Logic: By default, the script uses a 1:1 Risk-Reward Ratio (RRR). The stop loss is automatically set at the midpoint of the Tokyo range (marked by a red line). The take profit is calculated based on the distance between the entry and the stop loss, multiplied by the CRV setting.
• Session Filtering: The blue background highlights the active London trading session where entries are permitted. All pending orders are canceled outside of this window, and open positions are closed before the next Tokyo session begins.

Details

The strategy is built on the premise that the Tokyo session sets the initial liquidity boundaries for the day. When the London session opens—typically bringing significantly higher volume—a break of the overnight range can signal the trend for the remainder of the morning. This implementation uses a midpoint stop-loss approach rather than placing stops at the opposite side of the range, which allows for more aggressive risk-reward configurations.

Settings

Date Range

• Start/End Date/Month/Year: Defines the backtesting period to evaluate strategy performance over a specific historical duration.

Session Settings

• Session time Tokyo: Defines the start and end times for the Tokyo range calculation (Default: 00:00 - 06:55).
• Session time zone: Sets the time zone for the session inputs (Default: UTC).

Visuals

• Box border size: Adjusts the thickness of the Tokyo range box borders.
• Up/Down box & border colors: Customizes the colors used for bullish and bearish Tokyo session boxes.

Strategy Parameters

• Filter Entrytime: Enables or disables the restriction of entries to specific London trading hours.
• CRV (Risk-Reward Ratio): Adjusts the multiplier for the Take Profit relative to the Stop Loss distance. A value of 1.0 represents a 1:1 ratio.

FAQ

How do I use the London BreakOut Classic?

To use the tool, apply it to a low-timeframe Forex chart (1m, 5m, or 15m). Observe the Tokyo range box and the subsequent breakout during the London session (blue highlighted area) to see how the strategy performs under current market conditions.

Can I change the trading hours?

Yes, you can modify the "Session time Tokyo" and "Session time zone" in the settings menu to align with your local time or specific market opening hours you wish to track.

Where can I access this tool?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.