Asian Range Breakout

Setup

Setup criteria:

1. Asian range defined: The high and low of price action from Tokyo open (7 PM ET) through 2 AM ET.

2. Range size acceptable: Should fit within typical ATR — 30-80 pips on EUR/USD or GBP/USD. Outlier-sized ranges (very tight or very wide) are weaker setups.

3. Breakout window: 2 AM ET to 7 AM ET — the Tokyo-London handoff and early London hours.

Entry rules

Entry rules:

Confirmation entry: Enter on the close of a 15m or 1H candle that breaks out of the Asian range. Long above the high, short below the low.

Skip false breaks: If price breaks one side, retraces back inside, then breaks the OTHER side within the same window — that's a stop-hunt. Wait for the second-attempt close or pass on the day.

News filter: Skip on major-news days where the breakout is news-driven (different dynamics from organic breakouts).

Trade management

Trade management:

Stop loss: The opposite side of the Asian range, plus a small buffer.

Target: 1x the range size as the first milestone (so a 50-pip Asian range targets 50 pips of post-breakout move). Conservative traders take 1x; aggressive traders hold for 2x.

Time exit: If the trade hasn't reached 50% of target by the London-NY overlap (8 AM ET), close it. Asian-range moves typically play out within the early London session.

Pros and cons

Pros: Mechanical rules — easy to backtest. Pre-defined risk (range size). Captures the directional impulse Europe often introduces.

Cons: False breakouts ~30% of days. Requires being awake in the 2-7 AM ET window. Range sizes vary so a filter is needed for outlier days.

Best pairs: EUR/USD · GBP/USD · AUD/JPY. More context in the forex glossary, or see strategies stacked on real charts in the trading blog.

Asian Range Breakout FAQ