Guide to Day Trading Strategies

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and under whole dollars and half dollars is only signi
À
cant on stocks trading on high relative 
volume or trading at intraday extremes.
A chart showing 9 EMA support.
Moving Average Support and Resistance
Both daily charts and intraday charts respect moving averages. When a weak stock gaps up it’s not 
uncommon for the price to open around moving average resistance. Even though the stock has 
gapped up, it will struggle with the daily resistance levels unless the catalyst is particularly strong. 
I typically look to trade stocks in the direction of the daily trend. A stock gapping up should be 
breaking up and away from its moving averages just as a stock gapping down should be breaking 
down and away from its moving averages. We can use the information of daily windows and gaps, 

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R O S S C A M E R O N
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the levels of trend line support, and the position of the moving averages to help us create our 
long or short bias against a stock. This becomes the basis for how we will trade the stock.
On an intraday level moving averages present one of the most signi
À
cant forms of support and 
resistance. It’s very common to see trending stocks respecting the support of moving averages. 
It’s important to recognize this support because if we have a long bias we can use moving average 
pullbacks as entry opportunities. Often times these pullbacks will also take the familiar form of 
a bull 
Á
ag. In addition to noting the importance of moving average support and resistance, it’s 
important to be mindful of when price crosses moving averages. If the price has been respecting 
the 9 EMA all day long and suddenly crosses below it, there could be an opportunity for a trend 
reversal. We will cover the details of these trading strategies later on, but for now I’d encourage 
you to keep a close eye on how stocks trade around their moving averages.

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CHAPTER 7