Futures Globex Session Trade

Entry Logic

• Exact Entry Trigger: Enter long on a breakout above the Globex session high. Enter short on a breakdown below the Globex session low.
• Confirmation: The breakout/breakdown should occur within the first hour of the regular trading session.
• Timeframe: 30-minute chart.
• Location Context: Not applicable.
• Market Condition: A market that has been consolidating during the Globex session.

Exit Logic

• Profit Targets: A measured move from the Globex session range.
• Scaling Out: Not recommended.
• Trailing Stop: Trail the stop loss below the 20-period EMA on the 30-minute chart.
• Signal Failure Exit: Exit if the breakout/breakdown fails and the price closes back inside the Globex session range.
• Opposite Signal Exit: Not applicable.
• Time Expiration: Exit the trade by the end of the day.
• Momentum Loss: Exit if momentum starts to wane.

Stop Loss Structure

• Hard Stop: Place the stop loss on the other side of the Globex session range.
• Soft Stop: Not used.
• Max Dollar Loss: Varies by contract.
• Max Percent Loss: 1% of account capital.
• Structural Stop: The stop is placed behind the Globex session high or low.

Risk Management Framework

• Risk Per Trade: 0.5% of account capital.
• Maximum Daily Loss Limit: 2% of account capital.
• Maximum Weekly Loss Limit: 5% of account capital.
• Maximum Drawdown: 10% from peak equity.
• R:R Requirement: Minimum 1.5:1 risk-reward ratio.

Position Sizing Model

• Sizing Approach: Fixed fractional sizing.
• Volatility Adjustment: Not applicable.
• Conviction Sizing: Not applicable.
• Scaling In: Not recommended.
• Scaling Out: Not recommended.

Trade Filtering

• Market Conditions to Avoid: A market that has been trending strongly during the Globex session.
• Specific Setups Required: A clear and well-defined range during the Globex session.
• Instruments: Any futures contract with a liquid Globex session.
• Time Restrictions: Trade only during the first hour of the regular trading session.
• Chop/News Avoidance: Avoid trading during major news events.

Context Framework

• Trend Direction: Trade in the direction of the daily trend.
• VWAP Relationship: For longs, the price should be above VWAP. For shorts, the price should be below VWAP.
• MA Relationship: The 20 EMA should be above the 50 EMA for longs, and below for shorts.
• Range Location: Trade breakouts from the Globex session range.
• Higher TF Alignment: The daily and 4-hour charts should confirm the trend direction.

Trade Management Rules

• Breakeven: Move stop to breakeven after the first profit target is hit.
• Scale Out: Not applicable.
• Add Size: Not recommended.
• Fast vs Slow Moves: Let the trade run in fast moves. In slow moves, consider taking profits earlier.

Time Rules

• Optimal Trading Window: The first hour of the regular trading session.
• Times to Avoid: The rest of the day.
• Session Notes: This strategy is most effective when there is a clear range during the Globex session.

Setup Classification

• A+ Setup: A clear and tight range during the Globex session with a high-volume breakout.
• A Setup: A good range with a decent breakout.
• B Setup: A wide or sloppy range.
• C Setup: Avoid. A trending Globex session.

Market Selection Criteria

• Instruments: Any futures contract with a liquid Globex session.
• Volume/Liquidity: High volume and liquidity are essential.
• Volatility: Moderate to high volatility is preferred.

Statistical Edge Metrics

• Win Rate: 50-55%.
• Avg Win: 2.5R.
• Avg Loss: 1R.
• Profit Factor: 1.25.
• Expectancy: 0.25R per trade.

Failure Conditions

• When Strategy Fails: When the breakout from the Globex session range is a fakeout.
• Specific Scenarios to Avoid: Trading this strategy when the Globex session has been trending strongly.

Psychological Rules

• Mental Discipline: Be patient and wait for a clear breakout. Do not chase trades.

Advanced Components

• Regime Detection: Use a range filter to identify consolidating Globex sessions.
• Filters: Use a volume filter to confirm breakouts.
• Correlation: Not applicable.
• MTF Alignment: Ensure the higher timeframes are aligned with the trade direction.

Location

• Where Strongest: When the market has been quiet during the Globex session and is poised for a breakout.
• Where Weakest: When the market has been volatile during the Globex session.