Every rule. Open source.

Part 1 — The Philosophy

1.1 Trend following is not prediction

Trading is about reacting to what's already happening with enough discipline to stay in winners and cut losers. When a stock breaks out from a base on heavy volume, something has already changed. We don't have to know what. We just have to notice and respond.

1.2 Why momentum works

Momentum — the tendency of recent winners to keep winning — is one of the most empirically robust patterns in financial markets. It works because most market participants are slow to update their beliefs when new information emerges, and that lag creates trend persistence.

1.3 The Trend Champ posture

Three commitments shape every decision: aggressive enough to grow capital (target 30–80% annual on the trading account), patient enough not to die from noise (position-trade, not day-trade), disciplined enough to survive losses (every position has a defined exit before entry).

Part 2 — The Universe

We trade stocks meeting all of these conditions:

• Listed on NYSE or NASDAQ
• Market cap ≥ $1 billion
• Average daily volume ≥ 1 million shares
• Share price ≥ $5
• Not on any SEC suspension list
• Single-name common stock only — no ETFs, ETNs, ADRs, leveraged products
• At least 4 full quarters of earnings reported

Watchlist is built weekly using screeners filtering for: price > 50-day MA > 200-day MA (uptrend stack), recent 52-week high (or within 15%), relative strength rating top 25%.

Part 3 — The Setups

Setup 1 — The Base Breakout

Pattern: A stock has rallied off prior lows, then consolidates 4–10 weeks in a tight sideways range with decreasing volatility and drying volume.

Entry: Buy the day price breaks above the high of the base on volume ≥ 40% above average.

Stop: Day's low of breakout candle, or 7% below entry — whichever is tighter.

Invalidation: Price closes back below the breakout level same day or next day.

Setup 2 — The Pullback Catch

Pattern: Confirmed uptrend (above 50-day and 200-day MA) pulls back to 21-EMA or 50-SMA on lighter volume than the prior advance.

Entry: Buy reversal candle (hammer, inside-up day, strong close near highs) at moving average support.

Stop: 2–3% below the 50-day MA at entry.

Invalidation: Price closes below 50-day MA.

Setup 3 — The Earnings Surf (advanced)

Pattern: Stock gaps up 8%+ on earnings on heavy volume, digests 1–3 days without giving back the gap, then breaks the post-earnings high.

Entry: Break above the post-earnings high, intraday confirmation only.

Stop: 1% below the earnings gap fill price.

Risk note: Highest win rate, lowest hold time, closest to day-trading. Use sparingly.

Part 4 — Risk Management

• Max 1% account risk per trade. Position size = (1% of account) ÷ (entry − stop). Non-negotiable.
• Max 25% account in any single position. No exceptions.
• Max 20% account drawdown before pause. Close all positions. Review every trade. Resume only when market regime shifts positive.
• Max 6 open positions at a time. Focus over breadth.
• Cash is a position. When no setups fire, cash is the answer.

Part 5 — Exit Rules

• Stop hit = sold. No discussion.
• Take half off at +1.5R. Move stop on remaining shares to entry (breakeven). Now playing with house money.
• Sell on the trend break. Close below 21-EMA for 2 consecutive days, close below 50-day MA on any day, or climax run on extreme volume.

Part 6 — The Process

Daily (15 min evening): review open positions, update trade log, glance at watchlist.

Pre-market (15 min): check overnight news, mark trigger prices, set alerts.

Intraday: alerts only — you should not be sitting at the screen.

Weekly (Saturday, 60–90 min): rebuild watchlist, review week's stats, write weekly summary.

Part 7 — The Metrics That Matter

• Win rate: 35–50% is typical and fine
• Average win / loss ratio: ≥2.0
• Profit factor: >1.5 healthy, >2.0 excellent
• Max drawdown: below 20% good, above 30% means rules being broken