Pre-London High-Low Breakout Indicator

Overview
The Pre-London High-Low Breakout Indicator helps traders identify breakout opportunities at the London session open. It marks the high and low one hour before London opens (5 PM - 6 PM AEST) and incorporates a 200 SMA filter to confirm trade direction. The indicator also provides real-time breakout markers for precise entries.

How the Indicator Works

1. Pre-London High & Low Identification (5 PM - 6 PM AEST)

• [] The indicator tracks the highest and lowest price levels within this period.
  [] These levels act as key breakout zones once London opens.
  
• The high and low remain visible until 12 AM AEST for reference.
  

2. 200 SMA as a Trend Filter

• [] A 200 SMA (yellow, thick line) is plotted to filter breakout trades.
  [] Only long (buy) trades are valid if price is above the 200 SMA.
  
• Only short (sell) trades are valid if price is below the 200 SMA.
  

3. Real-Time Breakout Confirmation

• [] Buy Signal (Green Diamond):
  [] Price breaks above the pre-London high.
  [] Price is above the 200 SMA.
  [] Sell Signal (Red Diamond):
  [] Price breaks below the pre-London low.
  [] Price is below the 200 SMA.
  
• No signal appears if the breakout is against the SMA trend, reducing false trades.
  

How to Use the Indicator Properly

Step 1: Identify the Pre-London Range (5 PM - 6 PM AEST)

• [] Observe price movements and note the session high & low.
  [] Do not take trades within this period—wait for a clear breakout.
  

Step 2: Wait for a Breakout After 6 PM AEST

• [] A breakout must occur beyond the session high or low.
  [] The breakout should be clear and decisive, not hovering around the range.
  

Step 3: Confirm with the 200 SMA

• [] If price is above the 200 SMA, only buy signals are valid.
  [] If price is below the 200 SMA, only sell signals are valid.
  
• If a breakout occurs against the SMA, ignore it.
  

Step 4: Enter the Trade and Manage Risk

• [] Enter the trade after the breakout candle closes.
  [] Set stop-loss just inside the pre-London range to minimize risk.
  
• Take profit using a 1:2 or 1:3 risk-reward ratio, or trail the stop.
  

Why This Strategy Works

• [] Pre-London Liquidity Grab: Institutional traders set positions before the London open, making this range significant.
  [] Trend Confirmation with SMA: Reduces false breakouts by filtering trades in the direction of the trend.
  
• Real-Time Breakout Detection: Green and red diamond markers highlight valid breakouts that meet all conditions.
  

Final Notes

• [] If price breaks out but quickly reverses, it may be a false breakout—avoid impulsive trades.
  [] The indicator works best when combined with other confluences such as volume analysis or key support/resistance levels.
  
• Alerts can be added to notify traders when a valid breakout occurs.
  

This setup is ideal for traders looking for a structured, rule-based approach to trading London session breakouts with a strong trend confirmation mechanism.