Transcription
There is one scalping strategy I use every single day. It's incredibly simple, repeatable, and after seven years, it's the biggest factor of why I became a profitable trader. In this video, I'm going to share the full strategy along with the three simple steps that I used to execute this strategy. And then I'm going to show you live trades that I took in the real markets so you can see this strategy being used in real time.
So, in this video, we're going to go through an updated guide on my one candle scalping strategy that I've used this month on a consistent basis. And along with this, using the strategy, these are the results I've been able to achieve. But it's very important to remember that it took me 7 years to become a profitable trader and where I am today. Trading is not a get-rich-quick business. It took me years to truly master trading, and it did not happen overnight. However, using the strategy for myself, I've been able to achieve consistent results.
So, the goal of today's video is to learn one simple and proven strategy I use to trade for about 90 minutes on a consistent basis. The best part about my strategy is it doesn't require daily bias. It doesn't require fancy indicators and it gets rid of the guesswork when you're looking to take a trade because using the strategy, not only is it repeatable, but it's rule-based and mechanical. Therefore, this helps me avoid the guesswork and trade like a professional trader.
So to explain the strategy, first I'm going to explain the three simple steps I use every time I'm looking to enter. I'll then talk about my entry, stop-loss, and profit target criterias. And then one of the most important parts of this video will be the real time examples of trades that I took using this exact strategy in the real markets. And this way you'll be able to see the strategy working in real time and see exactly how I execute.
So to get into this strategy, the problem is that 90% of traders focus on range. As we can see here, the day opened up on this candle right here and it closed at this candle here. In between this range, there was a lot of different opportunities that you could have traded. You could have traded a potential breakout for a move to the upside. You could have traded a potential break and retest here for a move to the upside, or you could have just bought the support and sold the resistance. However, all of these setups, though they did form in the day, they weren't repeatable. You can't use them every single time consistently at the same time. And the purpose of this video is to get rid of the noise and focus on one proven strategy that I can trade before 11 a.m. Eastern.
And to do this, the first candle that opens in the session tells me more than all of the noise you saw in the previous range. Now, you may be asking, what does a session mean and what sessions should we be looking at? Well, there's a couple different sessions we have. We have the London session, we have the New York session, and we have the Asia session. Now, for me personally, I do not trade the London session, nor do I trade the Asia session. I trade the New York session. This is what we're going to talk about in today's video. And the New York session opens up at 9:30 a.m. Eastern and it closes at 4:00 p.m. Eastern. So, like I said, when we're talking about the first candle strategy, we will be talking about it based off of the New York session, which means the time that we're looking for the first candle to open is 9:30 a.m. Eastern.
For step one, we're going to mark out the high and the low of the first opening candle. For this video, the first opening candle we will be looking for is the first five-minute candle. The New York open is at 9:30 a.m. Eastern. Therefore, this candle will form from 9:30 to 9:35 a.m. Eastern. We're going to mark out the low and the high of the first candle. Before I continue, it's important to mention there is different opening ranges. You have your 1-minute opening range, the 5-minute opening range that we're talking about in this video, and the 15-minute opening strategy, which I've done a full in-depth guide before on my channel. The link to that will be in the free trading playlist in the description. You can watch that after this video. However, it's important to understand if the market is slow, you want to focus on the 15-minute time frame. If the market is faster, you want to focus on the 5-minute or the 1-minute. However, in the current market we're in, I've been focusing on the 5-minute strategy more than the 15-minute and the 1-minute opening range.
Now for step two, this is an important step and that is to wait for a down close candle to form. So as we can see here, we have the 5-minute high and we have the 5-minute low. In this 5-minute high and low, we have one down close candle. And because we have a down candle, we want to mark out the high and the low of the down candle and make a box around that. The reason we do this is because this is where sellers were sitting before. And now that we're breaking above the 5-minute high, well, we just got rid of all the sellers on this down close candle. And therefore, we want to mark this out because the sellers have left the down close candle, which leaves the buyers in this down close candle to hold the stock for a move to the upside. If this doesn't make total sense to you just yet, don't worry. When we get into the examples, this will make much more sense. But I want to reiterate, for an uptrend, we want to mark out the down close candle as this will hold the price for a move back to the upside. And for a downtrend, we're going to mark out the up close candle as this will hold the price for a move to the downside. And this is because in an uptrend, when we see the down close candle, this is where sellers are sitting. Therefore, buyers have to beat the sellers to move to the upside. And in a downtrend, the up close candle, that's where buyers were sitting. However, now sellers have to beat them for a move back to the downside.
So, as we can see, we had a clear uptrend. We got the down close candle. We see a little bit of movement to the downside. However, we then broke out of the 5-minute high. When we break out of the 5-minute high and come back for the retest, when we see this down candle, this is where buyers need to hold the price above. And therefore, we want to mark this out as this is where the most liquidity will be sitting alongside the 5-minute high. Vice versa. For the downside, if we have the 5-minute low right here, and we have an up close candle, this is where the most liquidity will be sitting for the 5-minute low on top of understanding that sellers need to hold the stock below this up close candle for continuation to the downside.
And finally, for step three, we want to go into the 1-minute time frame to actually look for an entry. And for our entry, we will use the one candle rule in combination with the 5-minute high. So, in this example, we can see on the 1-minute time frame, we have the 5-minute high up here. And for the down close candle that we mark, we want to mark the highest down close candle. In this example, this is the highest down candle in the 5-minute range. And therefore, we're going to mark out that candle. And you can see we marked out this candle here. And once we broke above the 5-minute high, we came back for the retest. And on this retest, it is very clear to see what we are looking for. We enter in on the retest with our stop loss at a break of the one candle rule. And our profit target needs to be a 2R multiple. A 2R multiple simply means for every $100 that we're willing to lose, we need to make $200 of profit. Therefore, in this example, you can see this trade had a really nice continuation to the upside. And we got more than that 2R that we were looking for in terms of our profit target.
Now, once again, when we get into the examples, all of this will make much more sense. I'm going to show you exactly how I execute this in real time. So, you'll be able to see not only how to draw the one candle rule more clearly, but how to execute and how to look for your stop-loss and profit targets. Now, before going to the examples very quickly, it's important to mention that there is three different entry confirmations you can use, whether it be the breakout, the retest, or the reversal. In today's video, we're going to be talking about the retest. However, if you want me to make a video on either the breakout or the reversal entry confirmations, make sure to leave a comment down below letting me know that you do want to see a video and I can make a video on these two entry confirmations soon. Along with this, if you've enjoyed this video so far, make sure to leave a like on this video. Let's see if we can get 5,000 likes. And I do have a very big announcement coming soon. So, make sure to stay tuned.
So, with this being said, now that I've shown you how the strategy actually works, let's go over to some live trading examples of trades that I took in real time to show you how I execute this setup in real time. All right, so here we are on the first example. After this example, I'm going to show you live examples. However, I want to show you this just so you understand exactly how the strategy works. Now, this is on the 1-minute time frame, and what we're going to do is go for the first five minutes. And you can see for the first 5 minutes, we're going to mark out the high and the low of the first 5 minutes of the New York stock open. The next thing we're going to do is wait for the stock to break above or break below the 5-minute high and the 5-minute low. So, let's see if the stock breaks above or below. In this example here, you can see this stock is clearly moving to the upside and it actually broke above the 5-minute high and therefore we've now completed the first step. We marked out the high and low of the first 5 minutes. We've also broken above the 5-minute high, which means we're now going to be looking for the retest and continuation to the upside. But how can we add even more confluence to this entry? Well, this is where we're going to look for that down close candle like I mentioned. And to look for the down close candle, you want in the uptrend, the highest down candle, and for the downtrend, the lowest uptrend candle. So, in this example, we can see two down candles. Which one is higher? The second one. So, we're going to mark out the down close candle here and move it over. Therefore, for this stock to retest, it can also come into that one candle rule because we know this is where buyers have to step in. Our stop loss is most likely going to be a break below and we're going to be looking for continuation to the upside.
Now, let's see if we actually get that retest entry. Okay, so in this example, you can see buyers stepped up and brought this above the 5-minute high. We then came back for the retest and you can see this down close candle wicked into this one candle rule showing that buyers stepped up aggressively exactly where they needed to hold price above along with holding and closing the candle above the 5-minute high. Now to enter into this trade here, our stop loss is going to be a break below the one candle rule and we need at least a 2R multiple at high of day. This was only a 1.85. Therefore, that 2R multiple comes at the whole psychological number of 183. This gives us about a 2.49 risk-to-reward trade, which means we're risking $770 for $1,590 of a potential result for this trade. So, let's play out this trade and let's see exactly what happens. And just like that, you can see we hit our full profit target for this trade. We were done before 11:00 a.m. Eastern. And like I said in the beginning of this video, I only trade from 9:30 a.m. to 11:00 a.m. Eastern every day. So, I showed you this example so you understand exactly how I use the first candle strategy in combination with the one candle rule to get high probability entries for my trades. But now, let's go over and look at some live examples of me actually executing this trade in the real markets. And that way, by the end of the video, you'll learn exactly how to use this strategy.
Okay, so here we are on our first live example. In this example, you can see we have our first 5-minute low down here and we have our 5-minute high up here. So, what we want the stock to do initially, exactly how I showed you in the last step, is to either break above the five-minute high or break below the 5-minute low. The first step we're waiting for is simply to mark out the high and low and wait for the stock to break above or below. Now, this is a trade that I took live. So, let's listen into exactly how I was planning my trade out. Tesla pre-market high retest. A lot of buyers stepped in off of that level. Now, what we can be looking for on Tesla is the retest of 31546 plus the 5-minute high. The 31546 is a pivot level from yesterday. It's also a 5-minute high. On top of that, we have the red candle on top right there as well, which would be the one candle rule. So, a lot of different factors on why that would be a high probability retest, but we'll see if we get that 31546 retest.
So, in this example, you can hear me say that we broke above the 5-minute high. We also have this one candle rule down close candle because now that we broke above, we are going to mark out the highest down close candle for the move to the upside. In this example, that would be this candle right here. So for this example, we know our stop loss is going to be a break of this down close candle. And for our profit target, we would be aiming for this move all the way back up into 31750s. So now we would want the retest on Tesla, show strong price action, and then look for continuation to the upside. Yeah, Tesla. This is the exact level. Like I said, the 31750 calls is what we can be looking for on Tesla. The 31750 calls. So, just because there's many traders that are listening into the live trading session with me, I am explaining what contracts I will be playing because I do trade options. So, I'm talking about the 31750 calls. Therefore, there's no confusion on exactly what I'm looking at. And now, I'm simply just waiting for strong price action on this 5-minute high plus this one candle rule. Let's see if buyers step up near this area. Q's is coming down to low of day here. The the 31750 calls is what I'm interested in. Tesla, I took the 31750 calls here as well. The 31750 calls on Tesla. One candle rule, like I said, a lot of different confluences near this level. Tesla, this one does have the strength so far in terms of relative strength. So, as you can see here, once this candle closed and strong buyer stepped up, I entered into Tesla as that candle closed into the next candle. And now I'm looking for that move back to the upside on Tesla after entering in based off of the one candle rule and the five-minute high exactly like I explained in this video. Yep, there's brand new high of day out here on Tesla. Boom. I'm taking a little bit more off on Tesla here as well. The 318 coming in on Tesla. Nice pop after that 317. And you can see just like I explained, this one had that 318 push. I let everyone know that this is where I'm scaling out of Tesla at that 318 key level exactly how I had planned and laid out before even taking the trade. And this was a great trade and a very simple way to show exactly how I use the 5-minute strategy along with the one candle rule. And of course, there was thousands of traders that were listening to this exact trade, not because they're trying to make quick money just by following my signals, but rather they're trying to learn a long-term skill the right way.
Now, with this being said, this was the first example on Tesla. Let's go over to one more live example so you see exactly how this strategy works. So, on this day, I want you to notice a couple things. We have our 5-minute high up here, and we have our 5-minute low down here. On top of this, we actually rejected off of the previous day high, which is this level right here. And we are now moving back to the downside. So, we can clearly see that Tesla is already pretty weak for the day. Therefore, we're most likely going to be waiting for the five-minute low break. However, because we're coming into the day with no bias, all we're going to do is wait either the break of the five-minute low or a break of the 5-minute high. So, let's see exactly what happens on this day. So, Q so far rejecting Tesla coming back down a little bit here as well. And then on Tesla, you just want to see continuation to the downside and then the retest of low of day that we're currently putting in right now. So for Tesla, you can hear me say that we want to see a move to the downside and then the retest of the low of day that we have right now. The low of day that we have right now is also the five-minute low. So 5-minute low with the retest to the downside if we can get the break below low of day.
All right. So here's Tesla breaking below low of day or the 5-minute low and therefore we've now confirmed that the stock is bearish and we are looking for the retest back into the 5-minute low. Now, we also want to mark out the up close candle because remember for a move to the upside, we're looking for the down close candle. However, because this is a bearish example, we are looking for the lowest up close candle. In this example, that lowest up close candle is this one right here. This is a green candle. And therefore, we could mark out the high and low of this candle and we know if the stock does come back into this retest, this is still a valid retest for a move back down to low of day. In this example, my main target that I would be targeting out would be that 301 key level. Now, let's see how Tesla ends up setting up. We'll wait to see if Tesla obviously can retest back into this 30350-ish area. And once again, you hear me say we want to see the retest of Tesla into that 30350-ish area. And that's because this is of course the 5-minute low on top of the one candle rule that we have right here. So, let's keep an eye out on Tesla 30350s. Yeah, this Tesla retest, we want to see the 30250s basically hit. We want to see weak price action. If we can get weak price action, we can look for the downside on Tesla. Let's see this retest here. Let's see if we can get weak price action for the contracts we can actually be looking for. We can look at the 30250 puts, the 30250 puts on Tesla. I'm going to be looking at the 30250 puts. Let's see if we can get weak price action here. You can also mark out the one candle rule right above this 30350 level. But yeah, took the 30250 puts on Tesla. Just took some off here. This is my first scale on Tesla. And just like that on this example, you heard me talk about exactly where I entered this Tesla trade. And you can see this one had a very nice move all the way down into 350s. And we were able to capture this move live in the accelerator and traders lab by understanding the 5-minute strategy along with the one candle rule.
Now, I have a very exciting announcement that I have coming up in the next couple of weeks. It's going to be absolutely free. If you want priority access and updates to the announcement before it goes public, make sure to join the wait list in the description. Along with this, if you want more examples on this strategy, or you want to learn how to start day trading from absolutely scratch as a beginner, make sure to click the playlist on screen now. It's a free 10-hour playlist going over everything I've learned in the last 7 years that's helped me become a profitable trader. If you enjoyed this video, make sure to leave it a like. If you have any questions, put them in the comments down below. Make sure to subscribe to the channel and follow me on Instagram and Twitter for more education. And I will see you guys next week with a brand new.