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I have recently started doing more day trading (or scalping by some definitions) using AVWAP. I don’t normally capture images from my buys and sells for PTA purposes, but I chose to today for this post. Let’s take a look at today’s trading in TQQQ

For my day trading execution, I focus on a 1-minute intraday chart. I place an AVWAP on the first bar of the day. For my first entry today, I bought right as TQQQ retook the flat-to-rising AVWAP (yellow line in the chart below) after a brief fade at the open. I set my stop at the day’s low.

TQQQ - First entry

TQQQ - initial entry

It started making a move higher before turning around and giving up those gains, breaking below the now flat-to-falling AVWAP. I sold just at my break-even spot to avoid a roundtrip loss.

TQQQ - First exit

TQQQ - initial exit
  • -0.02%
  • $0.01/share
  • -0.005% total equity

TQQQ continued to lose ground. Using some of the concepts in Brian Shannon’s book, I placed an AVWAP on the intraday high (red line). About 17 minutes later, it formed a handoff point for another AVWAP and continued lower after finding some support around the AVWAP from yesterday (orange line). It formed another handoff point around the confluence area of the 2-day AVWAP and the one off the prior handoff. I bought as it came back up through the flat-to-rising AWVAP from the second handoff.

TQQQ - Second entry

TQQQ - second entry

I made a fundamental mistake with my second entry. It needed more time to form a higher low followed by a higher high. I got a bit overzealous trying to catch this off the bottom. I think I realized that shortly after executing the order, so I gave it little room to correct. When it couldnt hold the AVWAP I bought it off of, I closed the trade with a small loss before it could trigger my stop at the day’s low.

TQQQ - Second exit

TQQQ - second exit
  • -0.17%
  • -$0.07/share
  • -0.037% total equity

What’s that you say…maybe the third time’s the charm with this one? I thought the same and decided to take another swing before striking out. After undercutting the low that preceeded my second entry, it rallied through the 2-day AVWAP and bumped up against the flat-to-rising AVWAP off the day’s high. This acted as my third entry with a stop at the first AVWAP handoff.

TQQQ - Third entry

TQQQ - third entry

It finally started moving up in my favor. Once profitable, I aggressively manage the position with trailing stops based on the definition of uptrend: higher highs/higher lows. If it undercuts the most recent higher low, it violates the definition of an uptrend.

TQQQ - raised stop

TQQQ - raise stop

Shortly after raising it, my stop got triggered, and I exited with a gain which more than made up for my earlier, small losses.

TQQQ - Third exit

TQQQ - third exit
  • +0.63%
  • $0.25/share
  • +0.13% total equity

I gave it one last go after it got above the key AVWAP levels I had my eye on and briefly tested prior support, forming a short-term higher low then higher high.

TQQQ - Final entry

TQQQ - final entry

I sold 1/3 into strength as it broke out past today’s opening high. Always good to sell partial into strength on a breakout to reduce risk.

TQQQ - partial sell

I closed the rest of the position as it undercut the prior high. I didn’t have enough time to day to keep watching and trading it due to job constraints. It would go on to make some additional headway later in the day.

TQQQ - final exit

  • +0.64%
  • $0.26/share
  • +0.09% total equity