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#DayTradingStrategy
Here’s a concise day trading strategy that combines technical analysis, risk management, and key principles for intraday success:
1. Core Strategy: Price Action + Volume + Key Levels
Tools:
5-min or 15-min candlestick charts.
VWAP (Volume Weighted Average Price) for trend confirmation.
EMA 9/20 for dynamic support/resistance.
High relative volume (min. 1.5x average volume for the session).
Setup:
Trade breakouts/pullbacks near key levels (previous day high/low, overnight highs/lows, or psychological levels like $50, $100).
Look for candlestick patterns (e.g., engulfing, inside bars, hammers) at these levels.
2. Entry Rules
Long Entry:
Price breaks above resistance with volume + closes back above VWAP.
EMA 9 crosses above EMA 20 (optional confirmation).
Short Entry:
Price breaks below support with volume + closes below VWAP.
EMA 9 crosses below EMA 20.
3. Exit Rules
Take Profit:
1:2 or 1:3 risk-reward ratio (e.g., 30¢ profit for 10¢ stop).
Partial profits at 1:1, trail stop for remainder.
Stop Loss:
Place below recent swing low (long) or above swing high (short).
Never risk >1% of account per trade.
4. Risk Management
Position Size:
Calculate shares based on stop distance (e.g., $100 risk / $0.10 stop = 1,000 shares).
Max Daily Loss:
Stop trading after losing 2-3% of account.
5. Best Times to Trade
High-Probability Sessions:
Open (9:30-10:30 AM ET): Volatility, breakouts.
Midday (11 AM-2 PM ET): Pullbacks/continuations.
Power Hour (3-4 PM ET): End-of-day momentum.
6. Filters for Higher Win Rate
Trend Alignment: Only trade with the higher timeframe trend (e.g., if SPY is green, focus on longs).
Sector Strength: Use sector ETFs (e.g., XLF for financials) to confirm momentum.
News Avoidance: Avoid earnings, Fed announcements, or gap fills >5%.
7. Example Trade
Stock: AAPL breaks above pre-market high ($195) with 2x volume.
Entry: $195.10 (stop at $194.50, risk = $0.60).
Target: $196.30 (1:2 reward).
Result: Exit 50% at $195.70, trail rest to breakeven.
