Hourly VWAP + 5-Min Momentum

Entry Logic

• Entry trigger: 5-minute chart shows a high-volume breakout candle.
• Confirmation: The hourly chart shows price is in a strong trend and above VWAP.
• Timeframe: Hourly for VWAP context, 5-minute for momentum entry.
• Location: Entry taken on a momentum burst on the 5-minute chart.
• Market condition: Strong intraday trend.

Exit Logic

• Profit target: 3R or the next resistance level on the hourly chart.
• Scaling out: Scale out 50% at 1.5R.
• Trailing stop: Trail stop below the 5-minute 9 EMA.
• Signal failure: Exit if the breakout candle fails.
• Opposite signal: Exit on a reversal pattern on the 5-minute chart.
• Time expiration: Exit if the trade is not profitable within 45 minutes.
• Momentum loss: Exit if volume dries up on the 5-minute chart.

Stop Loss Structure

• Hard stop: Below the low of the 5-minute breakout candle.
• Soft stop: A close below the 5-minute 9 EMA.
• Max dollar loss: $100 per trade.
• Max percent loss: 0.5% of account.
• Structural stop: Below the most recent swing low on the 5-minute chart.

Risk Management Framework

• Risk per trade: 0.5% of account.
• Daily limit: 4 losing trades.
• Weekly limit: 4% drawdown.
• Max drawdown: 12%.
• R:R requirement: Minimum 2.5:1.

Position Sizing Model

• Sizing approach: Fixed fractional, 0.5% of account per trade.
• Volatility adjustment: Not used in this strategy.
• Conviction sizing: A+ setups get 0.75% risk.
• Scaling in: Not used in this strategy.
• Scaling out: 50% at 1.5R.

Trade Filtering

• Market conditions: Avoid choppy, sideways markets.
• Setups: Only take long trades when the hourly chart is in a strong uptrend.
• Instruments: High-beta stocks.
• Time restrictions: First 3 hours of the trading session.
• Chop/news avoidance: Avoid trading around news releases.

Context Framework

• Trend direction: Determined by the hourly chart.
• VWAP relationship: Price should be above VWAP on the hourly chart.
• MA relationship: 5-minute 9 EMA should be above the 20 EMA.
• Range location: Entry taken on a breakout, not a pullback.
• Higher TF alignment: The 4-hour chart should also be in an uptrend.

Trade Management Rules

• Breakeven: Move stop to breakeven after a 1R move.
• Scale out: At 1.5R profit target.
• Add size: Not used in this strategy.
• Fast vs slow moves: Let fast moves run.

Time Rules

• Optimal window: 9:30 AM - 12:30 PM EST.
• Times to avoid: After 1:00 PM EST.
• Session notes: Strategy performs best with strong morning momentum.

Setup Classification

• A+ setup: Strong hourly trend, high-volume 5-minute breakout.
• A setup: Good hourly trend, but breakout volume is average.
• B setup: Hourly trend is weak.
• C setup: No clear hourly trend.

Market Selection Criteria

• Instruments: TSLA, NVDA, AMD.
• Volume: Minimum 5 million shares traded daily.
• Volatility: High intraday volatility.

Statistical Edge Metrics

• Win rate: 60%.
• Avg win: 3R.
• Avg loss: 1R.
• Profit factor: 1.8.
• Expectancy: 0.8R per trade.

Failure Conditions

• Strategy fails when the hourly trend breaks down.
• Avoid using this strategy in low-volume, choppy markets.

Psychological Rules

• Aggressiveness is needed to jump on the momentum breakout.
• Discipline is required to cut the trade if the breakout fails.

Advanced Components

• Regime detection: Use the 4-hour chart to determine the intraday regime.
• Filters: Avoid stocks with a large spread.
• Correlation: Ensure the sector is also trending.
• MTF alignment: 4-hour and hourly charts should be aligned.

Location

• Strongest: In a strong, trending market.
• Weakest: In a ranging, choppy market.