Day Trading Strategies: A Comprehensive Guide

Our proprietary day trading systems for the NASDAQ and S&P500 are designed to help you navigate different market conditions while matching your individual risk tolerance. Every day we publish three key trading levels, and our strategies—Alpha, Beta, and Gamma—offer unique approaches for entry, exit, and stop management.

Trading Systems Overview

System	Description	Win Rate
α1	3 levels, 3 exits (Official, longest back-tested)	96%
α2	3 levels, 3 exits, ratcheted stop	96%
α3	3 levels, 2 exits	92%
β1	2 levels, 3 exits	96%
β2	2 levels, 3 exits, ratcheted stop	96%
β3	2 levels, 2 exits	92%
γ1	1 level, tight stop, 3 exits	38%
γ2	1 level, tight stop, 2 exits	23%
γ3	1 level, loose stop, 3 exits	84%
γ4	1 level, loose stop, 2 exits	75%
γ5	1 level, favourable risk:reward	25%

Alpha Systems (α1, α2, α3)
• Entry Method: Three entries (one at each level) allow for averaging the entry price if multiple levels are hit.
• Risk Profile: Ideal for risk‐averse traders with very high win rates (92–96%).
• Highlight: α1 is our longest back-tested and official system.

Beta Systems (β1, β2, β3)
• Entry Method: Two entries (50% of the position at each level) lead to larger position sizes.
• Risk Profile: Balanced approach with win rates of 92–96%, offering moderate risk and profit potential.

Gamma Systems (γ1–γ5)
• Entry Method: A single, full-position entry with no averaging.
• Risk Profile: Higher risk due to a single entry and greater chance of stop-outs.
• Highlight: Among the Gamma variants, γ4 is the most profitable, followed by γ3.

Detailed Strategy Breakdown

1. Entry Methods

Alpha (3-Level Entry):
- Divide your position into three equal parts.
- If one level is triggered, you enter one-third of your intended position.
- When two or three levels are hit, the entry price is averaged to reduce risk.
Beta (2-Level Entry):
- Split your position into two equal halves.
- If only one level is triggered, you capture 50% of your position.
- Provides larger exposure compared to Alpha.
Gamma (1-Level Entry):
- Enter your full position at one level, without averaging.
- If the trade fails at the initial level, the stop is triggered, allowing for a re-entry at the subsequent level.
- Maximizes profit potential on a winning trade, but increases risk.

2. Exit Strategies

Three-Exit Systems:
- Structure: Includes a scalp exit plus two additional exits at resistance levels.
- Scalp Exit: Captures quick, small profits (20 points for NASDAQ; 5 points for S&P500).
- Remaining Exits: Reduce your position in thirds, locking in gains as resistance levels are reached.
Two-Exit Systems:
- Structure: No scalp exit; the trade is held until it reaches two main support/resistance targets.
- Exits: Taken in halves, leading to fewer winning trades but larger profit per trade when successful.

3. Stop Loss Management

Tight Stops:
- Fixed stop loss points (5 points for S&P500 and 20 points for NASDAQ) that mirror our scalp targets.
Loose Stops:
- Set based on the next lower proprietary level to give the trade more room to develop.

For Multi-Level Systems (Alpha & Beta):

Alpha (3-Level Systems):
- Standard Stop: Placed just below Level 3.
- After Scalp Hit: In non-ratcheted systems, the stop is raised to the entry level once a scalp is achieved.
- Ratcheted Systems (α2): The stop is incrementally raised after each target is hit.
Beta (2-Level Systems):
- Standard Stop: Set at the third entry level.
- After Scalp Hit: The stop is raised to the entry level to protect the position.

For Single-Entry Systems (Gamma):

Stop Setup:
- First trade: Enter at Level 1 with a stop at Level 2.
- If stopped out, re-enter at Level 2 with the stop adjusted to Level 3, and so on.

4. Risk and Reward Profiles

Alpha Systems:
- Win Rates: 92–96%
- Profile: Lower risk with averaged entries and early profit locking. Profits per trade tend to be smaller, but consistency is high.
Beta Systems:
- Win Rates: 92–96%
- Profile: Moderate risk with larger position sizes than Alpha. Balances win rate with higher profit potential.
Gamma Systems:
- Win Rates Vary:
  - Tight Stops: 23–38%
  - Loose Stops: 75–84%
  - Favourable Risk:Reward: 25%
- Profile: Highest risk, taking a full position at a single entry. When successful, profits are maximized. Note: γ4 is the most profitable, followed by γ3.

Trade Walkthrough: Step-by-Step Execution

A. Alpha Systems (e.g., α1)

Pre-Market Preparation:
- Identify your proprietary levels for NASDAQ and S&P500.
- Choose an Alpha system (α1 is our longest back-tested and official system).
Entry:
- Divide your position into three equal parts.
- Enter 1/3 at Level 1.
- If Level 2 is triggered, add another 1/3; similarly, enter the final 1/3 at Level 3 if hit.
Stop Loss Setup:
- Set your stop loss just below Level 3.
- For ratcheted systems (α2), raise the stop to the entry level after each scalp is achieved.
Exiting the Trade:
- Use a three-exit strategy:
  - Take a quick scalp exit (20 points for NASDAQ; 5 points for S&P500).
  - Exit the remaining position in two stages at designated resistance levels.

B. Beta Systems (e.g., β1)

Pre-Market Preparation:
- Mark your proprietary levels.
- Select a Beta system for a balanced risk/reward approach.
Entry:
- Divide your position into two equal halves.
- Enter 50% at Level 1; if triggered, enter the remaining 50% at Level 2.
Stop Loss Setup:
- Set your stop loss at Level 3.
- After hitting a scalp target, raise the stop to your entry level.
Exiting the Trade:
- Exit the trade in two phases based on predetermined resistance levels.

C. Gamma Systems (e.g., γ4)

Pre-Market Preparation:
- Identify your proprietary levels.
- Select a Gamma system for full-position exposure.
Entry:
- Enter your full position at the chosen level (e.g., Level 1).
Stop Loss Setup:
- Set your stop loss at the next level (for a Level 1 entry, set the stop at Level 2).
- If the trade is stopped out, re-enter at Level 2 with the stop adjusted to Level 3, and so on.
Exiting the Trade:
- Use either a two- or three-exit strategy based on your target structure.
- Remember: Gamma trades are higher risk but offer higher reward potential.

Risk Profile by Trading System Category

System Category	Risk Profile	Characteristics
Alpha	Lowest Risk	Three entries, averaging reduces downside risk; very high win rates (92–96%) with smaller profit per trade.
Beta	Moderate Risk	Two entries provide a balanced approach; win rates are high (92–96%) with moderate profit potential.
Gamma	Highest Risk	Single entry exposes the full position; more frequent stop-outs but higher profit potential when successful.

Profit Exit Structure: Risk & Reward

Exit Structure	Risk & Trade Dynamics	Profit Potential
3 Exits	Lower risk; trades are completed more frequently with early profit locking.	Lower profit per trade due to early exits.
2 Exits	Higher risk; fewer trades complete but positions are held longer, allowing for larger gains when successful.	Higher profit per trade, as exits occur at later, more significant support/resistance levels.

Conclusion

Our day trading strategies are designed to offer a comprehensive range of approaches, tailored to different market conditions and risk profiles. Whether you choose the averaged-entry, risk-averse Alpha systems (with α1 as our official system), the balanced Beta systems, or the high-risk, high-reward Gamma systems (with γ4 leading in profitability), this guide provides clear instructions on how to execute your trades with precision. Use this guide daily to select the strategy that aligns with your trading objectives and risk tolerance.

Day Trading Stratagies