High of Day Momentum Break

Entry Logic

• Entry trigger: Price breaks above the high of the day.
• Confirmation: Volume on the breakout bar is 2x the average volume.
• Timeframe: 5-minute chart.
• Location context: Price is above VWAP.
• Market condition: The market is trending up.

Exit Logic

• Profit targets: 1R and 2R.
• Scaling out: Sell 50% at 1R.
• Trailing stop: Use the 9-period EMA as a trailing stop.
• Signal failure exit: Exit if price closes below the breakout level.
• Opposite signal exit: Not applicable.
• Time expiration: Exit by the end of the day.
• Momentum loss: Exit if momentum slows significantly.

Stop Loss Structure

• Hard stop: Below the low of the breakout bar.
• Soft stop: A close below the breakout level.
• Max dollar loss: 0.5% of account equity.
• Max percent loss: 1% of the trade's value.
• Structural stop: Below the most recent swing low.

Risk Management Framework

• Risk per trade: 0.25% of account equity.
• Daily limit: 4 losing trades.
• Weekly limit: 15 losing trades.
• Max drawdown: 3% of account equity.
• R:R requirement: 1.5:1.

Position Sizing Model

• Sizing approach: Fixed risk per trade.
• Volatility adjustment: Not applicable.
• Conviction sizing: Not applicable.
• Scaling in/out: Scale out at profit targets.

Trade Filtering

• Market conditions: Avoid choppy markets.
• Setups: Only trade clean breakouts.
• Instruments: High-volume stocks.
• Time restrictions: Trade during the first 2 hours of the session.
• Chop/news avoidance: Avoid trading around news events.

Context Framework

• Trend direction: The 15-minute chart should be in an uptrend.
• VWAP relationship: Price must be above VWAP.
• MA relationship: The 9-period EMA is above the 20-period EMA.
• Range location: Breakout from an opening range.
• Higher TF alignment: The 1-hour chart should be bullish.

Trade Management Rules

• Breakeven: Move stop to breakeven after 1R is reached.
• Scale out: At profit targets.
• Add size: Do not add size.
• Fast vs slow moves: Let fast moves run.

Time Rules

• Optimal window: 9:30 AM to 11:30 AM EST.
• Times to avoid: After 11:30 AM EST.
• Session notes: Strongest in the morning.

Setup Classification

• A+ criteria: Clean breakout with high volume.
• A criteria: Breakout with average volume.
• B criteria: Messy breakout.
• C criteria: Avoid.

Market Selection Criteria

• Instruments: Stocks in play for the day.
• Volume: High relative volume.
• Volatility: Good intraday movement.

Statistical Edge Metrics

• Win rate: 60%
• Avg win: 1.5R
• Avg loss: 1R
• Profit factor: 1.9
• Expectancy: 0.5R per trade

Failure Conditions

• When strategy fails: Fails in choppy, non-trending markets.

Psychological Rules

• Mental discipline: Do not chase breakouts.

Advanced Components

• Regime detection: Not applicable.
• Filters: Volume filter.
• Correlation: Not applicable.
• MTF alignment: Check the 15-minute and 1-hour charts.

Location

• Where strongest: In strongly trending markets.
• Where weakest: In range-bound markets.