Intraday large swings

Intraday large swings is a day trading strategy that offers good opportunities most of the days. It can be used in any currency pair of your choice, on 5 and 15 minutes charts.
In this tutorial you learn step-by-step, intraday breakout technique

The best time of the day to trade this strategy is between 8h and 11h GMT (3am and 6am EST). This strategy can also be used between 13h and 17h GMT (8am and 12pm EST) but it usually works better during the European time frame.

Trading Rules

To enter in a long position: When you see a candle making a new high for the day, you should enter a buy order 1 pip above the breakout of this candle. In order to minimize risks, you should place a stop loss order 1 pip below the candle that made the breakout for the high of the day.

To exit a long position: You need to have the EMA10 on your chart. You should exit the trade on the breakout of the candle that closes below EMA10.

To enter is a short sell position: When you see a candle making a new low for the day, you should enter a short sell order 1 pip below the breakdown of this candle. In order to minimize risks, you should place a stop loss order 1 pip above the candle that made the breakdown for the low of the day.

To exit a short sell position: You should exit the trade on the breakout of the candle that closes above EMA10.

In sum:

Time of Day Between 8h and 11h GMT (3am and 6am EST). The second time frame you can apply

this strategy is between 13h GMT and 17h GMT (8am and 12pm EST)

Time Frames 5 and 15 minutes

Entry in a Long Position 1 pip above the candle that does the breakout of the high of the day

Entry in a Short Sell Position 1 pip below the candle that does the breakout of the low of the day

Stop Loss 1 pip below/above the entry candle, for long and short sell positions, respectively

Exit On the breakout of the candle that closed below/above the EMA10, for long and short sell positions, respectively

Currency Pairs You can use which one(s) you prefer.

Example 1

  Here is a 15 minutes EUR/USD chart. The blue line represents the low of the day so far (1.4793). Slightly after 8h GMT (3am EST), the currency pair makes a new low for the day. According to this strategy, you have a short sell opportunity here.

You can enter your short sell order at 1.4787 (1 pip below the candle that made the low of the day). You will insert the stop loss order 1 pip above this candle, at 1.4806.

On the next chart, the blue line represents the previous low of the day (1.4793), the red line represents your stop loss (1.4806) and the green line represents your entry point (1.4787).

You should exit this trade if the stop loss is reached or when there’s a breakout of a candle that closed above the EMA10.

So far, so good. This trade keeps moving in our way, and is far away from the stop loss point.

On this chart you can see that, for the first time, the price closed above the EMA10. That’s a warning sign. If the price breaks abovethis candle, you should exit the trade. Since the high of this candle is 1.4688, you’ll be ready to cover the trade if the price reaches 1.4689.

The price wasn’t able to break the previous candle. So, you remain on the trade.

At point 1, you can see that the price closed above the EMA10 once again. However, it wasn’t able to break the high of this candle, so you continued on this trade.

The exit point is represented in the chart by the orange line. This was when the price closed above the EMA10 and the next candle broke above the high of the first one.

You exited the trade at 1.4650. The profit on this trade was 137 pips, which means $1370 pips.

Example 2

Now let’s take a look at another trade, this time on a 5 minutes EUR/USD chart.

Around 15h40 GMT (10:40am EST), EUR/USD approaches the low of the day which is represented by the blue line. As you know, this strategy works better during the European time frame. However, it can also be used on the US time frame (between 13h GMT and 17h GMT – 8am and 12pm EST).

The entry point appeared at 1.4717 (green line); the stop loss was at 1.4779 (red line) – 1 pip above the candle that made a new low of the day.

On the last candle you can see that the price closed slightly above the EMA10. If the price breaks above the high of this candle, you’ll have an exit signal.

On the next chart you can see that prices broke above 1.4650, giving you your exit point.

The total profit for this day trade was 66 pips.

Example 3

On the next 5 minutes EUR/USD chart, you can see that a new low for the day occurred at 1.4702.

So, you have a short sell opportunity at 1.4701 and a stop loss 1 pip above the candle that made a new low for the day.

The price starts to move in your direction.

Once the price breaks the candle that closes above the EMA10, you will have your exit signal. The exit point comes at 1.4669 leaving us with 33 pips profit.

Example 4

Here is a 5 minutes GBP/USD chart:

GBP/USD just made a new low for the day at 9h15 GMT (4:15am EST). The currency pair was able to break down below the blue line that represented the previous low for the day.

So, you have a short sell opportunity 1 pip below the green line at 2.0580.

Let’s see what happened:

GBP/USD wasn’t able to reach the entry point. You should always enter on the breakout of the candle that made the new low or high in order to avoid false breakouts.

The currency pair reversed and even reached new highs for the day at 19h GMT (2pm EST).

Entering on the breakout of the candle that made the new high or low for the day is a simple but effective way to avoid lots of false breakouts.

Example 5

Let’s see another 15 minutes trade on GBP/USD.

In this example, GBP/USD just made a new day’s high, breaking the blue line (2.0183).

The entry point is represented by the green line at 2.0201 and the stop loss is represented by the red line at 2.0178.

The trade started to move your way, until it closed below the EMA10.
The exit point came at 2.0227. The profit on this trade was 27 pips, which means $227 in a single trade.

As you can see by these examples, this strategy is extremely flexible and easy to use. It gives you good opportunities most of the days, and offers a good risk/reward. Since we use the EMA10 to exit the trade, you’ll able to maximize the profits most of the times.