News trading is one of the fastest ways to profit from financial markets, especially during high-impact events like CPI releases, interest rate announcements, or major geopolitical news. While many traders focus solely on the initial spike brians club approach emphasizes a breakout + retest strategy, combining the excitement of volatility with the discipline of technical confirmation.
This strategy is designed to reduce false breakouts and enhance the probability of capturing strong moves immediately after major news.
Understanding Breakout + Retest in News Trading
A breakout occurs when price moves decisively beyond a key level of support or resistance, often triggered by news events that shift market sentiment.
A retest happens when the price comes back to the broken level to confirm it as a new support (after breaking resistance) or resistance (after breaking support).
Why it matters for news trading:
- Immediate reactions to news can produce fake breakouts, where price spikes quickly but reverses.
- Waiting for a retest allows traders to confirm that the breakout is genuine before committing capital.
- This approach blends news-driven momentum with technical discipline, which Brians Club emphasizes.
Step 1: Pre-News Preparation
- Identify High-Impact News
- Focus on events like CPI, interest rates, or major economic indicators.
- Use an economic calendar to mark release times.
- Mark Key Levels
- Determine pre-news support and resistance levels on your chart.
- Use daily highs/lows or recent swing points for guidance.
- Prepare Scenarios
- Decide your potential breakout direction based on market sentiment.
- Set risk limits and stop-loss levels in advance.
Step 2: Spot the Breakout
- Observe the first reaction to the news:
- A sudden candle closing above resistance or below support indicates a breakout.
- Check volume spikes to ensure the move is supported by market participation.
- Avoid entering immediately at the peak:
- Initial breakouts can often overshoot briansclub recommends waiting for a retest for confirmation.
Step 3: Wait for the Retest
- After the initial breakout, the price may pull back to the broken level.
- Look for:
- Small momentum candles testing the level without breaking back below support (or above resistance).
- Reduced volatility during the retest; this indicates a stable level.
- Confirmation: Enter the trade when the retest holds, typically using a limit or market order just beyond the retest candle in the breakout direction.
Step 4: Execution Rules
- Entry: After the retest confirms the level.
- Stop-Loss: Place just below (for long) or above (for short) the retest zone to protect from reversals.
- Position Sizing: Risk only 1–2% of capital per trade, especially during high-volatility news events.
- Take Profit:
- Use a risk-reward ratio of at least 1:2 or 1:3.
- Monitor price action; exit if momentum fades or reversal patterns appear.
Step 5: Post-News Review
- Record the outcome of each trade:
- Did the retest hold?
- Was the breakout genuine or a false spike?
- Adjust your strategy over time based on patterns you observe for specific news events or instruments.
Example: EUR/USD CPI Breakout + Retest
- Pre-News: CPI expected at 0.3%, previous 0.2%, resistance at 1.1000.
- Breakout: Actual CPI hits 0.5%, EUR/USD spikes above 1.1000.
- Retest: Price pulls back to 1.1000, tests it with a small candle but holds above.
- Entry: Enter long at 1.1005 after confirmation.
- Stop-Loss: 1.0980 (below retest low).
- Take Profit: 1.1050 for a 1:2 risk-reward ratio.
Tools Brians Club Traders Use
- Economic News Feed: Real-time data for CPI, interest rates, or breaking news.
- Charting Software: Identify breakout levels, retests, and momentum candles.
- Low-Latency Broker: Fast execution is essential for capturing news-driven moves.
Common Mistakes to Avoid
- Entering too early before the retest is confirmed.
- Ignoring volume: Weak breakout with low volume is often a fake move.
- Overleveraging during volatile news events.
- Failing to plan exits: Letting profits turn into losses if momentum reverses.
Why Brians Club’s Breakout + Retest Works
- Reduces False Breakouts: Waiting for confirmation avoids early whipsaws.
- Balances News Momentum with Technical Discipline: Combines psychology and chart-based triggers.
- Structured Risk Management: Stops and position sizing protect capital during volatile periods.
FAQs
Q1: Can this strategy be used for any news event?
Yes, but it works best for high-impact news that produces strong initial momentum.
Q2: How long do you wait for the retest?
Usually 1–5 minutes post-breakout; the exact timing depends on volatility.
Q3: Is it suitable for beginners?
Yes, but start with demo accounts to practice spotting breakouts and retests without risking real money.
Conclusion
The Brians Club news trading strategy for breakout + retest turns fast, volatile news events into structured, high-probability trading opportunities. By combining pre-news preparation, momentum observation, and discipline around retests, traders can capture strong moves while minimizing risk.
It’s a perfect example of how technical confirmation and news-driven trading can coexist to create a repeatable formula for success.
