How to Day Trade for a Living

Moving Average Trend Trading
Some traders use moving averages as potential entry and exit points for day trading. Many
stocks will start an upside or downside trend respecting their moving averages in 1-minute and
5-minute charts as type of a moving support or resistance line. Traders can benefit from this
behavior and ride the trend along moving average (on top of moving average for going long or
below moving average for short selling).
I have been asked why moving averages are becoming support or resistance, and the answer is
because many traders are looking at these lines and making decisions based on them. Therefore,
they have a self-fulfilling prophecy effect. There is no fundamental reason behind moving
averages being a support or resistance line.
I use 9 and 20 exponential moving averages (EMA) and 50 and 200 simple moving averages
(SMA). I won’t go into the details of what moving averages are and the differences between
simple and exponential in order to keep this book short. You can, however, do a Google search
and find information about these moving averages or you can of course contact me directly
through 
www.Vancouver-Traders.com
with any questions you may have. Your charting software
will haves most of the moving averages built in. They are ready to be used and there is no need
to change the default setting in them.
Let’s take a look at the chart below for NUGT to see how you could trade based on 9 EMA in a
1-minute chart.
Example of a Moving Average Trend Strategy on NUGT.
As you can see, at 15:06 pm I noticed NUGT has formed a Bull Flag. I saw that a consolidation

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period was happening on top of 9 EMA. As soon as I saw that 9 EMA was holding as the
support, I jumped on the trade and rode the trend until the price broke the moving average at
15:21 pm. I’ve marked my entry and exit points on the chart.
Let’s take a look at another example, Celgene Corporation (CELG), on June 16, 2016. In the
chart below, you will see how you can trade based on 20 EMA in a 1-minute chart. I marked my
entry and exit points on the chart.