Day Trading: Equities
Status: Scaffolded - Content pending Last Updated: 2025-12-11
How Equity Day Trading Works
When you request a DAY trade on a STOCK, the algorithm uses more data than scalping but still focuses on intraday action.
Data Collection
| Data Type | What We Get |
|---|---|
| Current Price | Real-time snapshot (bid, ask, last, volume, VWAP) |
| Historical Bars | 5 days of 1-minute candles |
| Bars to AI | 240 most recent bars |
| Indicators | RSI(14), EMA(9,20), SMA(20,50,100,200), MACD |
| VWAP | Volume-weighted average price (from snapshot) |
| Previous Day | PDC, PDH, PDL |
| Market Context | SPY, QQQ, VIX direction |
Analysis Flow
1. Data Collection (5 days, 1-min bars)
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2. Technical Agent analyzes:
- Support/Resistance (last 2-3 hours)
- Opening Range (first 15 min)
- PDC, PDH, PDL
- Full indicator suite
- Chart patterns
- Multi-timeframe alignment
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3. Macro Agent checks:
- SPY/QQQ/VIX direction
- Market regime
- Cross-sector analysis
- News sentiment
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4. Wild Card Agent checks:
- Earnings announcement
- Economic releases
- News catalysts
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5. Supervisor synthesizes:
- Entry zone
- Stop loss (guardrail typically $1.00-$2.00 on liquid equities; anchored to support/resistance + volatility)
- Targets (typically $2.00-$3.00 and $4.00-$5.00, anchored to resistance)
- Position size
- Time stop (market close)
Entry Methodology
Day Trading Entry Process:
- Pre-Market Analysis — Review overnight action, pre-market gaps
- Opening Range — First 15 minutes establishes the range
- Wait for Confirmation — Don't chase the open
- Enter at Key Levels — Support/resistance, moving averages
- Full Position — Commit with conviction at identified level
Position Sizing
Risk Amount = Account Size × Risk Percent
Shares = Risk Amount ÷ Stop Distance
Example:
- Account: $50,000
- Risk: 1% = $500
- Stop: $1.50 below entry
- Shares: $500 ÷ $1.50 = 333 shares
Exit Rules
| Condition | Action |
|---|---|
| Price hits Target 1 | Exit 50% of position |
| Price hits Target 2 | Exit remaining 50% |
| Price hits Stop Loss | Exit 100% immediately |
| 3:45 PM ET | Exit remaining position |
Critical: No holding overnight for day trades.
Key Levels to Watch
| Level | Description |
|---|---|
| Opening Range | First 15-minute high/low |
| VWAP | Volume-weighted average price |
| PDC | Previous Day's Close |
| PDH/PDL | Previous Day's High/Low |
| SMAs | 20, 50, 100, 200 day moving averages |
What the Trade Plan Looks Like
Direction: LONG
Entry Zone: $152.50 - $153.00 (SMA 20 support + PDC)
Stop Loss: $150.50 - $151.00 (below PDL)
Target 1: $155.00 - $155.50 (50% of position)
Target 2: $157.50 - $158.00 (remaining 50%)
Time Stop: Market close (4:00 PM ET)
Position Size: 300 shares
Max Risk: $500 (1% of account)
Day Trade Equity Checklist
Before entering:
- Volume above average
- Clear support/resistance levels
- Not entering in the first 15 minutes (unless Opening Range breakout)
- Multiple timeframe alignment
- No major news imminent
- Time before close > stop distance expectation