Parabolic Move Entry

Entry Logic

• Entry trigger: A stock goes parabolic, with multiple large candles in a row.
• Confirmation: The stock is far extended from its moving averages.
• Timeframe: 1-minute chart.
• Location context: The stock is at a new high or low of the day.
• Market condition: The market is experiencing extreme volatility.

Exit Logic

• Profit targets: 1R and 2R.
• Scaling out: Sell 50% at 1R.
• Trailing stop: Use a very tight trailing stop, like the 5-period EMA.
• Signal failure exit: Exit if the stock continues to move against you.
• Opposite signal exit: Not applicable.
• Time expiration: Exit within 10 minutes.
• Momentum loss: Exit as soon as momentum slows.

Stop Loss Structure

• Hard stop: A fixed percentage, like 1%.
• Soft stop: Not applicable.
• Max dollar loss: 0.25% of account equity.
• Max percent loss: 0.5% of the trade's value.
• Structural stop: Not applicable.

Risk Management Framework

• Risk per trade: 0.1% of account equity.
• Daily limit: 5 losing trades.
• Weekly limit: 20 losing trades.
• Max drawdown: 2% of account equity.
• R:R requirement: 1:1.

Position Sizing Model

• Sizing approach: Very small position size.
• Volatility adjustment: Not applicable.
• Conviction sizing: Not applicable.
• Scaling in/out: Not applicable.

Trade Filtering

• Market conditions: Only trade in extremely volatile markets.
• Setups: Only trade clear parabolic moves.
• Instruments: High-beta, volatile stocks.
• Time restrictions: Not applicable.
• Chop/news avoidance: Not applicable.

Context Framework

• Trend direction: Not applicable.
• VWAP relationship: Not applicable.
• MA relationship: The stock should be very far from its moving averages.
• Range location: Not applicable.
• Higher TF alignment: Not applicable.

Trade Management Rules

• Breakeven: Not applicable.
• Scale out: At profit targets.
• Add size: Do not add size.
• Fast vs slow moves: This is a very fast-moving strategy.

Time Rules

• Optimal window: Not applicable.
• Times to avoid: Not applicable.
• Session notes: Can occur at any time.

Setup Classification

• A+ criteria: A true parabolic move.
• A criteria: A strong, extended move.
• B criteria: A moderately extended move.
• C criteria: Avoid.

Market Selection Criteria

• Instruments: Stocks that are known to go parabolic.
• Volume: Extremely high volume.
• Volatility: Extreme volatility.

Statistical Edge Metrics

• Win rate: 70%
• Avg win: 1R
• Avg loss: 1R
• Profit factor: 1.4
• Expectancy: 0.4R per trade

Failure Conditions

• When strategy fails: Fails if the stock continues to move in the same direction.

Psychological Rules

• Mental discipline: This is a very high-stress strategy.

Advanced Components

• Regime detection: Not applicable.
• Filters: Not applicable.
• Correlation: Not applicable.
• MTF alignment: Not applicable.

Location

• Where strongest: At the peak of a parabolic move.
• Where weakest: In a normal, trending market.