Guide to Day Trading Strategies

R O S S C A M E R O N
86
Chart with entry setup at $11.00 for a Flat Top Breakout and a 
break of Pre-Market Highs. This Gap and Go trade resulted in 
a near 20% pro
À
 t in the 
À
 rst 
À
 ve minutes of trading.
Gap and Go - Buying the Bull Flag or Flat Top Breakout
If the pre-market chart already has a clear bull 
Á
ag or 
Á
at top breakout pattern, I will simply 
trade the 
Á
ag pattern. In the case of the bull 
Á
ag, I will buy the 
À
rst one minute or 
À
ve minute 
candle to make a new high, and set my stop at the low of the pullback. I will hold this position 

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H O W T O D A Y T R A D E
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until I have reached a pro
À
t target or exit indicator. My absolute favorite entry on Gap and Go 
stocks is buying the pre-market high, when we have a well-de
À
ned 
Á
at top breakout pattern 
holding above moving average support. Since the 
Á
at top will coincide with pre-market highs, 
if it also lines up just below a whole dollar, it is a very powerful setup. Additionally, if we can 
see a heavy offer on the Level2 when the market opens, it con
À
rms the resistance at the apex 
point of the pattern. In order to break the apex point, a lot of buyers need to step in and buy 
up the shares sitting on the Ask. When it looks like the shares are almost all gone, I will place 
my order to try to jump in just seconds before the break. If I jump in too soon, there is the risk 
that not all the shares will get bought up and the resistance will hold. If I jump in too late, I 
will miss the breakout and my opportunity to trade a winner. Timing is very important on Gap 
and Go trades. This requires the use of the best trading tools, including direct access routing 
and hot keys. Once that apex point breaks, Gap and Go stocks will often make a quick and 
sometimes dramatic break through the resistance level. I will typically look to take pro
À
t on 
that 
À
rst surge, and then quickly adjust my stop to breakeven to protect the winner. We will 
review the exit indicators later in this chapter. In one of our best Gap and Go stocks, we took a 
position at $2.50 and sold on the move up to $5.00, for a 100% move in less than 15 minutes 
of trading. Anyone waiting for the market to open and who had just begun looking for trades, 
would have missed that opportunity.

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