Daily Fibonacci + Intraday Price Action

Entry Logic

• Entry trigger: 5-minute chart shows a bullish engulfing candle at a key Fibonacci retracement level.
• Confirmation: The daily chart is in an uptrend and has pulled back to the 50% or 61.8% Fibonacci level.
• Timeframe: Daily for Fibonacci, 5-minute for entry.
• Location: Entry taken at the daily Fibonacci level.
• Market condition: Trending market with a deep pullback.

Exit Logic

• Profit target: The previous swing high on the daily chart.
• Scaling out: Scale out 50% at 2R.
• Trailing stop: Trail stop below the 5-minute 20 EMA.
• Signal failure: Exit if the daily chart closes below the Fibonacci level.
• Opposite signal: Exit on a bearish reversal pattern on the 5-minute chart.
• Time expiration: Exit if the trade is not profitable within 2 days.
• Momentum loss: Exit if the 5-minute chart shows declining volume.

Stop Loss Structure

• Hard stop: Below the low of the 5-minute entry candle.
• Soft stop: A close below the daily Fibonacci level.
• Max dollar loss: $200 per trade.
• Max percent loss: 1% of account.
• Structural stop: Below the most recent swing low on the daily chart.

Risk Management Framework

• Risk per trade: 1% of account.
• Daily limit: Not applicable for this strategy.
• Weekly limit: 3% drawdown.
• Max drawdown: 10%.
• R:R requirement: Minimum 3:1.

Position Sizing Model

• Sizing approach: Fixed fractional, 1% of account per trade.
• Volatility adjustment: Adjust size based on the daily ATR.
• Conviction sizing: Not used in this strategy.
• Scaling in: Not used in this strategy.
• Scaling out: 50% at 2R.

Trade Filtering

• Market conditions: Avoid choppy markets.
• Setups: Only take trades at key Fibonacci levels in a trending market.
• Instruments: Large-cap stocks and ETFs.
• Time restrictions: Not applicable for this strategy.
• Chop/news avoidance: Be aware of news events that could impact the trade.

Context Framework

• Trend direction: Determined by the daily chart.
• VWAP relationship: Not a primary factor.
• MA relationship: The daily 20 SMA should be pointing up.
• Range location: Entry taken on a pullback.
• Higher TF alignment: The weekly chart should also be in an uptrend.

Trade Management Rules

• Breakeven: Move stop to breakeven after a 1.5R move.
• Scale out: At 2R profit target.
• Add size: Not used in this strategy.
• Fast vs slow moves: Hold through both fast and slow moves.

Time Rules

• Optimal window: Not applicable for this strategy.
• Times to avoid: Not applicable for this strategy.
• Session notes: Not applicable for this strategy.

Setup Classification

• A+ setup: Perfect daily trend, clean pullback to the 61.8% Fib level, strong 5-minute entry.
• A setup: Good daily trend, but pullback is to the 50% Fib level.
• B setup: Daily trend is weak.
• C setup: No clear daily trend.

Market Selection Criteria

• Instruments: SPY, QQQ, AAPL, MSFT.
• Volume: High daily volume.
• Volatility: Moderate volatility.

Statistical Edge Metrics

• Win rate: 50%.
• Avg win: 3.5R.
• Avg loss: 1R.
• Profit factor: 1.75.
• Expectancy: 0.75R per trade.

Failure Conditions

• Strategy fails when the Fibonacci level does not hold.
• Avoid taking trades if the daily trend is not clear.

Psychological Rules

• Patience is required to wait for the deep pullback.
• Conviction is needed to buy when the market is selling off.

Advanced Components

• Regime detection: Use the weekly chart to identify the market regime.
• Filters: Avoid taking trades if the daily chart is overextended.
• Correlation: Ensure the sector is also showing strength.
• MTF alignment: Weekly and daily charts should be aligned.

Location

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