Power Hour Momentum (3:00-3:30)

Entry Logic

• Entry trigger: Breakout of a tight consolidation on the 5-minute chart.
• Confirmation: A surge in volume.
• Timeframe: 5-minute chart.
• Location context: Trade in the direction of the daily trend.
• Market condition: A strong trending day leading into the final hour of trading.

Exit Logic

• Profit target: 2R or the closing print.
• Scaling out: Not recommended.
• Trailing stop: Trail with the 9 EMA on the 2-minute chart.
• Signal failure exit: Exit if the breakout fails.
• Opposite signal exit: Not applicable.
• Time expiration: Exit all trades by 3:50 PM EST.
• Momentum loss: Exit if momentum stalls.

Stop Loss Structure

• Hard stop: Below the low of the consolidation for longs, above the high for shorts.
• Soft stop: Not used.
• Max dollar loss: $200 per trade.
• Max percent loss: 1% of account.
• Structural stop: Below the most recent swing low/high.

Risk Management Framework

• Risk per trade: 1% of account.
• Daily limit: 1 trade.
• Weekly limit: 3% drawdown.
• Max drawdown: 10%.
• R:R requirement: Minimum 2:1.

Position Sizing Model

• Sizing approach: All-in or nothing.
• Volatility adjustment: Not applicable.
• Conviction sizing: This is an A+ setup or no trade.
• Scaling in/out: No scaling.

Trade Filtering

• Market conditions: Only trade on strong trend days.
• Setups: Only trade breakouts from tight consolidations.
• Instruments: High-volume, high-beta stocks.
• Time restrictions: Entry between 3:00 and 3:30 PM EST.
• Chop/news avoidance: Be aware of any late-day news.

Context Framework

• Trend direction: Trade with the dominant trend of the day.
• VWAP relationship: Price should be well above/below VWAP.
• Moving average relationship: Price should be trending strongly with all major moving averages.
• Range location: Trade the breakout of the late-day consolidation.
• Higher TF alignment: The daily and 60-minute charts must be aligned.

Trade Management Rules

• Breakeven: Move stop to breakeven after 1R.
• Scale out: Not applicable.
• Add size: Not applicable.
• Fast vs slow moves: Expect a fast move.

Time Rules

• Optimal trading window: 3:00-3:30 PM EST.
• Times to avoid: Any other time.
• Session notes: This is a high-stakes, high-reward trade.

Setup Classification

• A+ criteria: A perfect breakout from a tight consolidation with massive volume.
• A criteria: Not applicable.
• B criteria: Not applicable.
• C criteria: Not applicable.

Market Selection Criteria

• Instruments: Stocks that are the leaders of the day.
• Volume: Must be very high.
• Volatility: Must be high.

Statistical Edge Metrics

• Win rate: 40%.
• Avg win: 4R.
• Avg loss: 1R.
• Profit factor: 1.6.
• Expectancy: 0.6R per trade.

Failure Conditions

• Fails if the market reverses into the close.
• Avoid on quiet, range-bound days.

Psychological Rules

• Requires a high level of conviction and risk tolerance.
• Must be able to handle the stress of late-day trading.

Advanced Components

• Regime detection: Use market internals to confirm the trend.
• Filters: Only trade the strongest stocks of the day.
• Correlation: Be aware of the overall market direction.
• MTF alignment: All timeframes must be aligned.

Location

• Strongest: On a strong trend day that is closing at its highs/lows.
• Weakest: On a choppy, range-bound day.