The 5 Min Opening Bell Ascending Triangle Day Trading Strategy

This day trading strategy focuses on the first 1-2 hour of the trading day. It is suitable for those who want to only trade the early session. This trading strategy is quite similar to the 5 min ascending triangle day trading strategy. The only difference is that this trading strategy only happens in the first 2 hours of the trading day.

What this means is you find the 5 min ascending triangle in the first 2 hours. Anything after that is not valid. As you might not want to spend the whole day looking for the ascending triangle.

Criteria

Here are the criteria for this day trading strategy:

The stock has gone up a lot the previous day or it gap up a lot today
The stock forms a 5 min ascending triangle in the 5 min chart
The stock is above the 5 min rising 20 MA
Buy when stock trades above the ascending triangle
Put a stop loss at the bottom
Sell 1/2 or 2/3 when reach first target
Sell the remaining when reach resistance area or after 2 hours

Let's take a look at the 5min chart of HLBZ above.

There was a 5 min ascending triangle. The trader should buy the breakout and put a stop loss below the entire pattern.

1st target is where you achieve a 1:1 ratio of risk: reward. Meaning if you risk $100, when you area making $100, sell 1/2 or 2/3 of your position. Sometimes the stock can go higher and the remaining half position is used to ride the trend higher.

But since we are only interested to play the stock for the first 2 hours we do not want to hold the stock any longer than 2 hours. Sell the stock around the 2 hour mark. Sometimes it could be earlier sometimes it could be later. But try not to hold the stock past 12 pm Eastern Time. That is when lunch starts to come in and some stocks start to collapse.