Pre-Market Breakout Trading Strategy
This strategy trades breakouts during the pre-market hour, using moving average and momentum indicators to determine short-term trends to trade at peak volatility. It is a typical short scalping strategy.
Strategy Logic:
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Define pre-market range as within 1 hour of open.
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Use 50-period EMA to gauge fair price range.
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SMI crossover at lows signals long entry.
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Closing below EMA is stop loss signal.
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Take fixed profit target for short-term scalping.
Advantages:
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Breaking short-term EMA shows intraday trend.
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SMI confirms bottom reversals.
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Limited backtest parameters make live trading simple.
Risks:
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Breakouts prone to pre-market traps, beware reversals.
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Single daily session Unable to defend against gaps.
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Tight stops inclined to premature exit if calibrated poorly.
In summary, this is a typical pre-market short scalping strategy using EMA/SMI to ride high volatility breakouts. But the risk of pre-market traps is high, requiring small position sizing and disciplined stop loss.
/*backtest
start: 2022-09-12 00:00:00
end: 2023-09-12 00:00:00
period: 4d
basePeriod: 1d
exchanges: [{"eid":"Futures_Binance","currency":"BTC_USDT"}]
args: [["v_input_7",65]]
*/
// This source code is subject to the terms of the Mozilla Public License 2.0 at https://mozilla.org/MPL/2.0/
// © Trading_Bites
//@version=5- 1