Mark the high and low of the first five-minute candle at 9:30am, then switch to a one-minute chart and wait for a break of either level. Entry requires a fair value gap and a double break pattern, with a 4:1 risk-to-reward ratio.
I only use one candle to trade every single day. This strategy is so stupid simple that even a complete beginner couldn't mess it up. It's called the first candle rule and it uses the first five minute candle of the day to give you your entire trade entry. Stop loss and take profit. Here is how it works. Step one, you want to mark out the high and the low of the first five minute candle. This is the candle that happens right at 9:30am New York time. And step two is you're going to go to a one minute chart and wait for a break of either the high or the low. Now, to confirm a good break, we need a specific type of behavior. No, it's not a candle closure and it's definitely not just a wick. What we're looking for is a fair value gap and a double break. The fair value gap is to confirm we're on the right side of the market, but the double break is to avoid losing trades. Fair value gaps, well, they're simple. It's just a three candle pattern with an expansive middle candle leaving space in between the first and the third candles. Wicks and the double break, well, it's also easy. And after the fair value gap, we wait for a simple pattern to form. What we're looking for is a candle to come back into the range after the fair value gap forms. But that's not it. After this, we want a candle closure outside of the range in the same direction of the original fair value gap. Now, once this happens, we enter the trade with stops right at the candle that originally broke out of the range. And for our target, we'll use a fixed four to one risk to reward, meaning we make four times as much on our winning trades as we lose on the losing trades. If this video helped you comment. Yes, and I'll DM you my entire strategy.
