5. Round Number Level Trade

Entry Logic

Enter long when price breaks and holds above a major round number (e.g., 15000 on NQ). Confirm with a 5-minute close above the level. Use 5-minute timeframe. Price must test the level multiple times. Market must be trending up.

Exit Logic

Target next major round number or 1.5R. Scale out 50% at 0.75R. Trail stop below prior 5-minute low. Exit remaining position if price closes below the round number. Exit at session close. Momentum loss means exit.

Stop Loss Structure

Place hard stop 15 ticks below the round number. Max dollar loss $200. Max 0.5% portfolio loss. Structural stop below the breakout candle low.

Risk Management Framework

Risk 1% per trade. Daily loss limit 3%. Weekly loss limit 7%. Require 2:1 R:R minimum.

Position Sizing Model

Size to risk 1% of capital. Volatility adjusts size; smaller size for higher ATR. Conviction sizing: A+ setups get 1.5% risk. Scale in rarely; only with strong confirmation.

Trade Filtering

Trade NQ, ES. Avoid chop. Avoid news. Only trade after 9:45 AM EST.

Context Framework

Trade with the higher timeframe trend. Price must be above VWAP. Price must be above 20-period EMA. Round number acts as psychological support/resistance. Higher timeframe shows clear direction.

Trade Management Rules

Move to breakeven after 0.5R profit. Scale out 50% at 1R. Do not add to losing positions. Fast moves require tighter stops.

Time Rules

Optimal entry 9:45 AM - 11:30 AM EST. Avoid lunch hours. Session close 3:45 PM EST.

Setup Classification

A+ setup: Strong break of major round number, high volume, clear higher TF trend. A setup: Break of round number, good volume, moderate higher TF trend. B setup: Break, average volume, weak higher TF trend. C setup: Avoid.

Market Selection Criteria

Trade NQ, ES. Require average daily volume > 1M. Require ATR > 10 points.

Statistical Edge Metrics

Target 57% win rate. Average win 1.4R. Average loss 0.7R. Profit factor 1.3. Expectancy $24 per $100 risked.

Failure Conditions

Strategy fails if round number break is false. Fails if volume is low. Fails if market reverses sharply.

Psychological Rules

Respect round numbers. Do not anticipate breaks. Execute with conviction.

Advanced Components

Regime detection confirms trending market. Filter out low volume breaks. Correlation with SPY confirms NQ move. MTF alignment shows all timeframes trending.

Location

Strongest when round number is tested multiple times before breaking. Weakest when price approaches round number on low volume.