I learned this strategy day 17 years ago and a still use it to this day with only a few minor modifications. The strategy is a momentum breakout technique that catches stocks and other markets while they are going through a period of heavy volatility and momentum. Anyone who has basic experience day trading will tell you that one of trading biggest challenges for most traders is finding stocks and other markets that are moving with stocks momentum and volatility to make day trading worthwhile. Because day trading is based on intraday momentum, you trading to make sure the markets you chose and the strategies strategies pick have enough momentum to justify your risk. You want to start with the daily chart so that you can see the past trading history and the characteristics of the market you choose to trade. I start out by monitoring stocks that are close to 90 day breakouts. As you know based on my previous articles the 90 day breakout produces the highest ratio of winning to losing trades. The best candidates for my trades either gap up to a 90 day high or stocks the 90 day high by way of extended trading range. I will show you both examples so you can get a good idea of the type of set up you need to find. The Trading Reaches 90 Day High By Gapping Up Through The Upper Resistance Area. Once the stock breaks out stocks the 90 day high I wait for a confirmation signal. There are too many false breakouts and I want to make sure that the momentum is real and not ending immediately after the price breaks out of the trading range. My condition to entry is a gap day following the breakout from the 90 day price high. This means if the price broke out strategies the 90 day range by way of gaping up I will want to see a second gap day prior to my entry. You can see in this example how the stock breaks out and once again gaps up for the second day in a row. This is would be sufficient for me to justify entering the stock. Once you get a solid confirmation by way of a second gap, you can safely enter the market. My advice would be to watch the market carefully prior to the opening and get a feel for the stock you are trading. Most market orders get filled instantly so you will be assured that your condition to entry has been completely satisfied prior to your order being executed. Once your order is executed you stay with the trading till the closing bell. Since this is a momentum strategy the odds of the closing price being in the top 20th percentile of the highest price is roughly 80 percent so I suggest you hold the trade till the closing bell and exit MOC or Market on Close. If you were paying attention a few minutes ago you might have noticed that I said that the first or the initial breakout outside the trading range does not have to be a gap but can be an extended range day. I want to make sure you clearly understand the concept of extended trading stocks so this example utilizes a stock that breaks outside of the 90 day trading range through volatility and price instead of gaps. Everything beyond that point is the same except the initial set up can substitute the first gap if the extended trading range is sufficiently strong enough. Here you can see how the stocks trading range is almost strategies the recent trading range for this stock. This is the type of strong trading range you want to see breaking out of the 90 day price high. The Breakout Bar Is About Three Times The Size Of The Average Trading Bar For This Stock. Remember that no matter how good the initial breakout looks you have to make sure your entry is preceded by a gap no matter what. You can see in this final example how the entry and the exit appear on an intraday chart. Notice I wait for the gap and then enter a market order immediately after the opening gap. The order typically takes about 3 seconds to execute on a volatile market. I recommend you watch the market closely prior to the opening so that you are ready to go when and if the gap occurs. Place Your Stop Loss Order Immediately After You Get Your Entry Fill Back. The Momentum Breakout is one of the easiest and productive day trading methods for traders looking for momentum set ups. Remember that the breakout can be either a gap or an extended range bar. Either way, you cannot enter the trade prior to a confirmation gap that occurs at the opening after the breakout outside of the trading range. This is pure momentum so you want to make sure you give the strategy day to work. For more on this topic, please go to: Member Login Technical Support. Home Trading Education Company Resources Contact Terms Of Use Privacy Policy Disclaimer Members. Menu Home Trading Education Company Resources Contact Terms Of Use -Privacy Policy -Disclaimer Members. 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Day Trading Strategy That Can Make you $2000 A Day in the Stock Market
Day Trading Strategy That Can Make you $2000 A Day in the Stock Market
Chernyavskiy, Pavel (2015) On the analysis of event-related potential and electroencephalographic data: Spatio-temporal modeling, variography, and simulation.
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Chernyavskiy, Pavel (2015) On the analysis of event-related potential and electroencephalographic data: Spatio-temporal modeling, variography, and simulation.
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