My Intraday Trading System and Rules

Disclaimer: The information below is for educational purposes only. The information is intended to show an example of how one can approach intraday trading but is not a recommendation nor suggestion of how to trade.

My intraday System is based on following the trend of the 5m 20MA.

The goal is to enter as soon as the direction is confirmed and to follow it as long as the trend remains intact.

Some rules and guidelines.

- Only trade in the direction of the 5m 20MA (no counter trend trades)
- Never trade a sideways 5m 20MA, be patient and let the market show it's hand first
- Once price has cleared consolidation, enter on first pull back
- Always wait for confirmation, do not anticipate
- Trade the 5m chart, but it's okay to based entries and exits on the 2m chart
- Believe that the 20MA will hold a pullback
- Believe that any large move will have a pull back and then move that same amount or more for it's second leg.
- If I get stopped out of a valid entry, immediately start looking for the second entry.

Since markets trend consolidate and then trend again, my objective is to enter at the beginning of the trend and milk the trend for as much profit as possible.

This works best in on a trending day, but below is a document of market direction for the last 2 days as measured by the direction of the 5m 20MA.

Wednesday:

6:30 Sideways
7:00 Up
7:30 Up
8:00 Up
8:30 Up
9:00 Sideways
9:30 Down
10:00 Down
10:30 Down
11:00 Down
11:30 Down
12:00 Down
12:30 Sideways
1:00 Sideways

Thursday:

6:30 Down
7:00 Down
7:30 Up
8:00 Up
8:30 Up
9:00 Up
9:30 Up
10:00 Up
10:30 Sideways
11:00 Sideways
11:30 Up
12:00 Sideways
12:30 Down
1:00 Down

From the two days above and by looking at their charts, you can see that both days have good opportunities for catching some extended moves. The Key is to first understand the direction of the 5m 20MA and second to watch how the price is acting next to it.

Notice on today's chart (Thursday) how at 7:30 the price was now above the 20MA and that it remained above the UPTRENDING 20MA 10:15, over 2 hours heading up.

My goal is to continue getting better at trading my 20MA trend rather then trading the candle movement within the trend. Watching the movement within the trend is more noise than creditable, actionable information.

I'm not advocating entering or exiting on each direction change of the 20MA, but my profits will be greater the more I can trust the 2OMA especially on large trending days in one direction.

TF Thursday: 5 Minute Chart



TF Wednesday: 5 Minute Chart