Most of the retail traders work for years attempting to develop a profitable system, but they continually lose money with bad entries, false breakouts, and untrusted signals. There are so many indicators and systems that it is daunting to figure out what really works.
But there was one plan that separated itself from the pack — the plan that made $10,000 into $1.1 million over a mere 12 months. Formulated and employed by Larry Williams, a seasoned trader with years of experience under his belt, this plan became the stuff of legend by returning an astronomical 11,300% in one year.
This article will take you through The Strategy That Made Him $1.1 Million In 12 Months, including the very specific indicators, settings, and rules you can use right away. If you’re searching for a high-probability, momentum-based breakout strategy, this is for you.
What Is the Strategy?
Larry Williams’ system is known as the LW Volatility Breakout Strategy. It’s a straightforward but effective system that employs Donchian Channels in combination with volume and trend confirmation tools to filter out noise and catch explosive moves — particularly on the 5-minute timeframe, the same one Larry employed to reach his profits.
The Core Indicator: Donchian Channels
The basis of The Strategy That Made Him $1.1 Million In 12 Months is the Donchian Channels indicator.
Adding It:
Visit your charting software (such as TradingView).
- Type in “Donchian Channels” under the indicator.
- After adding, change the length to 96.
- Alter the line colors to red for ease of visibility.
This is set up for the 5-minute timeframe. If you are using a different time frame, you will have to backtest and adjust accordingly.
Understanding the Donchian Channels
The indicator is made up of three most important lines:
- Upper Band – the highest high in the last 96 periods.
- Lower Band – the lowest low in the last 96 periods.
- Middle Line – the mean of the upper and lower bands.
Most Important Interpretations:
- Price above middle line = bullish.
- Price below middle line = bearish.
- The upper/lower bands serve as dynamic support and resistance levels.
- Breakouts above/below the bands can signal strong momentum moves.
Yet, in sideways consolidation, the bands become too tight and may induce false breakouts — resulting in losses. That’s where confirmations step in.
The Confirmation Indicators
To screen out bad trades and low-momentum moves, Larry Williams’ breakout strategy employs two more confirmation tools.
1. LWTI – Larry Williams Trade Index
- Add the LWTI indicator.
- Set the period to 25 and smoothing to 20.
- This tool serves to confirm if a genuine trend is behind the breakout.
- Green LWTI = uptrend.
- Red LWTI = downtrend.
2. Volume Indicator
Add a simple volume indicator.
- Set the MA length to 30.
- Turn on the volume moving average and make it white.
Observe volume bars to be above the white line (the MA). This verifies the breakout is supported by heavy participation — one of the most important considerations in The Strategy That Made Him $1.1 Million In 12 Months.
LW Volatility Breakout Strategy Rules
Here’s how to implement this strategy step-by-step.
Long Trade Setup
- Timeframe: 5-minute chart.
- Trigger: Price touches or breaks above the upper Donchian band.
- LWTI Confirmation: Should be green (bullish trend).
- Volume Confirmation: Green bar above the white MA line.
- Entry: Take the trade on the breakout candle close.
Stop Loss:
Standard: Just below the middle band.
Alternate: If too wide, use the most recent swing low.
Take Profit: Place at a 2:1 risk-to-reward ratio.
Short Trade Setup
- Price crosses the lower Donchian band.
- LWTI turns red.
- Red volume bar is above white MA.
- Short entry after all confirmation signals.
- Stop Loss is placed above the middle band or recent swing high.
- Take Profit at 2:1 risk/reward setting.
Common Pitfalls to Evade
Despite being extremely powerful, one trap which traders constantly face while implementing The Strategy That Made Him $1.1 Million In 12 Months is that they find themselves trading right on important levels of support as well as resistance.
Example
Even when all the indicators signal green, when price is reaching or is at a strong resistance level, it could reverse. That is why Larry’s approach complements multi-timeframe analysis so well.
The Secret Trick: Higher Timeframe Zones
To enhance your accuracy:
- Switch to the 1-hour chart.
- Identify significant support and resistance levels.
- Steer clear of entering trades at or close to those levels.
- Opt for breakouts through major zones — they provide greater confluence and momentum.
This step serves as a last filter, preventing you from falling into traps and fakeouts and only making trades with genuine potential.
Summary: Why This Strategy Works
The Strategy That Made Him $1.1 Million In 12 Months is trend-following, momentum-confirmation, and multi-timeframe-aware. Here’s why it’s effective:
Donchian Channels pick out important breakout points.
- LWTI confirms the direction of the trend.
- Volume confirms participation in the market.
- Support/Resistance filtering prevents fakeouts.
- Risk management is built in with intelligent stop loss and reward ratios.
Conclusion
Larry Williams didn’t stumble into his $1.1 million victory. He designed it with a strategy that was both simple and precise. Now you have access to The Strategy That Made Him $1.1 Million In 12 Months — including indicators, rules, and optimization tips.
Whether you are a new or experienced trader, this system provides a tested method for trading high-probability breakout trades. Add it to good risk management and ongoing education, and you can aim for incredible results as well.
Want to master it? Add the indicators, stick to the rules, and take charge of your trading today.