Volume Profile Point of Control Trade

Entry Logic

• Entry is a long position when the price pulls back to the current day's Point of Control (POC) and finds support.
• Confirmation is a bullish pin bar or engulfing candle.
• Timeframe is the 30-minute chart.
• Location is at the POC.
• Market is in an uptrend.

Exit Logic

• Profit target is the value area high (VAH).
• Do not scale out.
• Trail the stop loss below the low of the previous bar.
• Exit if the price closes below the POC.
• Exit on a bearish reversal pattern.
• Exit if the price does not reach the target by the end of the day.
• Exit if the POC migrates lower.

Stop Loss Structure

• Hard stop is placed below the entry candle's low.
• Soft stop is a close below the POC.
• Maximum dollar loss is $200 per trade.
• Maximum percent loss is 2% of the account.
• Structural stop is below the value area low (VAL).

Risk Management Framework

• Risk 1.5% of the account per trade.
• Daily loss limit is 4% of the account.
• Weekly loss limit is 8% of the account.
• Maximum drawdown is 25%.
• Risk-reward ratio must be at least 1:1.

Position Sizing Model

• Use a fixed fractional position sizing model.
• No volatility adjustment.
• Full size for all setups.
• Do not scale in or out.

Trade Filtering

• Avoid trading on days with low volume.
• Only trade when the POC is clearly defined.
• Trade only major stock indices.
• Avoid trading in the last hour of the session.
• Do not trade when the market is in a tight range.

Context Framework

• Trend is up.
• Price is above VWAP.
• Price is above the 50 EMA.
• Location is at the POC.
• The higher timeframe chart (daily) shows a clear uptrend.

Trade Management Rules

• Move stop to breakeven when the price reaches the midpoint between the POC and the VAH.
• Do not scale out.
• Do not add to the position.
• Hold the trade until the target is reached or the stop is hit.

Time Rules

• Optimal trading window is from 10:00 AM to 2:00 PM EST.
• Avoid trading in the first 30 minutes of the session.
• The strategy works best on trending days.

Setup Classification

• A+ setup: Pullback to the POC in a strong uptrend with a clear rejection.
• A setup: Pullback to the POC in a moderate uptrend.
• B setup: Pullback to the POC in a weak uptrend.
• C setup: No clear trend.

Market Selection Criteria

• Trade SPY, QQQ, and IWM.
• High volume is required.
• Moderate volatility is preferred.

Statistical Edge Metrics

• Expected win rate is 65%.
• Average win is 1.5R.
• Average loss is 1R.
• Profit factor is 0.975.
• Expectancy per trade is -0.025R.

Failure Conditions

• The strategy fails when the market reverses trend.
• Avoid trading when the POC is not well-defined.

Psychological Rules

• Be patient and wait for the price to come to you.
• Trust the POC as a support level.

Advanced Components

• Use a trend filter to confirm the uptrend.
• Use a volume filter to confirm the strength of the POC.
• Do not trade correlated indices in the same direction.
• The daily chart must confirm the uptrend.

Location

• Strongest in a clear uptrend.
• Weakest in a downtrend or a range-bound market.
• The location of the POC relative to the previous day's value area is important.