Multi-Timeframe Moving Average Alignment

Entry Logic

• Entry trigger: 5-minute chart shows a pullback to the 20 EMA.
• Confirmation: The 15-minute, hourly, and daily charts all show price trading above their respective 20 EMAs.
• Timeframe: Multiple timeframes for alignment, 5-minute for entry.
• Location: Entry taken on a pullback on the 5-minute chart.
• Market condition: Strong trend across multiple timeframes.

Exit Logic

• Profit target: 3R or the next resistance level on the hourly chart.
• Scaling out: Scale out 50% at 1.5R.
• Trailing stop: Trail stop below the 5-minute 20 EMA.
• Signal failure: Exit if the 5-minute chart closes below the 20 EMA.
• Opposite signal: Exit on a reversal pattern on the 5-minute chart.
• Time expiration: Exit if the trade is not profitable within 1 hour.
• Momentum loss: Exit if volume dries up on the 5-minute chart.

Stop Loss Structure

• Hard stop: Below the low of the 5-minute pullback.
• Soft stop: A close below the 5-minute 20 EMA.
• Max dollar loss: $100 per trade.
• Max percent loss: 0.5% of account.
• Structural stop: Below the most recent swing low on the 5-minute chart.

Risk Management Framework

• Risk per trade: 0.5% of account.
• Daily limit: 3 losing trades.
• Weekly limit: 4% drawdown.
• Max drawdown: 12%.
• R:R requirement: Minimum 2.5:1.

Position Sizing Model

• Sizing approach: Fixed fractional, 0.5% of account per trade.
• Volatility adjustment: Not used in this strategy.
• Conviction sizing: A+ setups get 1% risk.
• Scaling in: Not used in this strategy.
• Scaling out: 50% at 1.5R.

Trade Filtering

• Market conditions: Only trade when all timeframes are aligned.
• Setups: Only take long trades in a strong uptrend.
• Instruments: Any trending stock.
• Time restrictions: First 3 hours of the trading session.
• Chop/news avoidance: Avoid trading around news releases.

Context Framework

• Trend direction: Determined by the alignment of multiple timeframes.
• VWAP relationship: Price should be above VWAP on the 5-minute chart.
• MA relationship: All timeframes are aligned.
• Range location: Entry taken on a pullback.
• Higher TF alignment: This is the core of the strategy.

Trade Management Rules

• Breakeven: Move stop to breakeven after a 1R move.
• Scale out: At 1.5R profit target.
• Add size: Not used in this strategy.
• Fast vs slow moves: Let fast moves run.

Time Rules

• Optimal window: 9:30 AM - 12:30 PM EST.
• Times to avoid: After 1:00 PM EST.
• Session notes: Strategy performs best with strong morning momentum.

Setup Classification

• A+ setup: Perfect alignment of all timeframes, clean 5-minute pullback.
• A setup: Most timeframes are aligned, but one is lagging.
• B setup: Only a few timeframes are aligned.
• C setup: No alignment.

Market Selection Criteria

• Instruments: Any stock with high volume and a clear trend.
• Volume: Minimum 1 million shares traded daily.
• Volatility: Moderate to high intraday volatility.

Statistical Edge Metrics

• Win rate: 65%.
• Avg win: 3R.
• Avg loss: 1R.
• Profit factor: 1.95.
• Expectancy: 0.95R per trade.

Failure Conditions

• Strategy fails when the alignment breaks down.
• Avoid using this strategy in choppy, non-trending markets.

Psychological Rules

• Patience is required to wait for the full alignment.
• Discipline is needed to only trade when the setup is perfect.

Advanced Components

• Regime detection: The alignment itself is a form of regime detection.
• Filters: Avoid stocks with low relative volume.
• Correlation: Ensure the sector is also aligned.
• MTF alignment: This is the core of the strategy.

Location

• Strongest: In a strong, trending market across all timeframes.
• Weakest: In a choppy, non-trending market.