Intraday Trendbreak Scalp Strategy
The objecive of this strategy is to take advantage of quick scalps in the market when we get small time frame trendbreaks (2min, 5min)
An example of this strategy working is pictured below (April 24, 2023)
The reason this trade worked, is because of multiple factors
- This was the 2nd attempt at a break of the 2min trend after the bigger morning sell off
- We had just made a bullish 2min bottoming candle
- We were at a demand zone from previous days (5min chart)
- We had just come off of an extended sell off
The problems that could arise from this strategy are that:
- If you risk the bullish bottoming 2min candle (LOD), your R is most likely a 1:1
- This strategy is a Trend Reversal Strategy
- You have strong trending days where you will have multiple fake reversals throughout the day
- You potentially have to be aggressive on your entry of the break, which can expose you to more risk
- It can be hard to hold a winner because of above ^^ (4.)
- In terms of a stop, this should probably be a trade that instantly works, otherwise you get out. That is the only way to keep your R positive
Pre-Entry Requirements
- Is this a strong, grinding trend day in either direction? If YES, DO NOT TAKE THIS TRADE. This is a Trend Reversal Strategy. It is not worth taking on a strong, grinding trending day (Example in photo below: April 25, 2023)
Entry Requirements
- Entry should be on a 2nd attempt at a trendbreak after a very previous attempt
- Have recently made a fake high/low with a bullish/bearish candle (wick) at the attempted breakout/breakdown
Stoploss:
- 2 ticks below entry candle - Breakout or Bailout to preserve a proper R (more conservative)
- Possibly below or above fakeout candle (more risky)
Reasons To Exit
- Key Level such as VWAP/50 EMA
- Previous Supply/Demand
- Stop at breakeven (once this trade starts working, risk should be taken off the table)
- Broken 2min trend that you are in - sometimes these reversals can move big so potentially let winners run
