A Very Simple Intraday Breakout Strategy
- Draw upper and lower lines on first hour bar. If the next candle does not break upper and lower lines of first hour bar, then cancle those lines, draw the same lines for second hour bar. Continue the sequence likewise.
- On seeing breakout of these lines, switch down the timeframe to 5 minutes and see that a complete 5 min candle forms outside the hourly channel drawn as in point 1 above. Once that happens get into the trade. Long for above breakout. Short for below breakout.
- There are two ways to ride it.
A) Scalping. Book profit upon seeing it. Stop loss is the low of the five min candle on which trade is triggered.
B) Day trading. Book 50% upon seeing profit. Keep stop loss at the other side of channel. Trail the SL apropriately.
Courtesy: Velur
