The Scalper's Secret: Trading the Cup and Handle on Intraday Charts

The Cup and Handle pattern is not just for swing traders. It can also be traded on intraday charts, such as the 5-minute or 15-minute chart. However, intraday trading requires a different set of skills and a different mindset.

Entry Rules

Entry for an intraday Cup and Handle is the same as for a swing trade, but the signals are more frequent. The breakout from the handle should be on high relative volume.

Exit Rules

Exit rules for an intraday trade are much tighter. A profit target of 1R or 2R is common, where R is the risk per trade. A tight trailing stop-loss should be used to protect profits.

Profit Targets

Profit targets for an intraday trade are smaller than for a swing trade. The goal is to take small, consistent profits throughout the day.

Stop Loss Placement

Stop loss placement for an intraday trade is very tight. A stop loss of just a few cents below the entry price is common.

Position Sizing

Position sizing for an intraday trade is larger than for a swing trade. This is because the stop losses are tighter.

Risk Management

Risk management for an intraday trade is all about speed. You need to be able to make quick decisions and execute your trades flawlessly.

Trade Management

Trade management for an intraday trade is very active. You need to be constantly monitoring your trades and the market.

Psychology

The psychology of intraday trading is all about discipline and focus. You need to be able to handle the stress of making quick decisions and taking small losses.