The Fractal Breakout is the least aggressive of the five Bill Williams indicators. It encompasses a series of market moves and is often used to confirm a buy or sell signal. The first move outlined by the system occurs when a market has made a new high or low. Next, the market reverses and retreats to prior levels. Finally, the market trades out of its old range again, this time even farther.
The system suggests that traders put on positions immediately, if the market moves beyond the most recent fractal, with a buy stop entered one tick beyond the fractal. Additionally, if the market forms another fractal in the same direction as their current position, the system recommends that traders aggressively increase their positions.
Fractal Parameters
Fractal parameters are a particular case of BW Fractal parameters where Leverage is automatically and permanently off and the Level value applies to both the LeftLevel and RightLevel, so that they are always of equal value.