Intraday Setups Described Concretely
Most writing about intraday strategy stays at the level of principle. This page does the opposite: it describes specific setups precisely enough that each could be tested by someone else, which is the standard any tradable rule has to meet.
Each is given with its trigger, its invalidation and the conditions in which it reliably fails. None works everywhere, and knowing where each stops working is the more useful half.
Why Precision Matters More Than Variety
A setup that cannot be stated in a sentence cannot be reviewed afterwards. When a defined rule fails repeatedly that is information; when an impulse fails, nothing has been learned.
Two or three precise setups beat a large collection of vague ones, because only the precise ones accumulate evidence.
Setup One: Opening Range Break
Define the range formed in the first stretch of trading. The trigger is price closing beyond one edge with expanding participation; invalidation is a return inside the range.
It works in directional sessions and fails in rangebound ones, where the break is marginal and reverses almost immediately.
Filtering the Break
Requiring a hold beyond the edge rather than a touch, or requiring participation to expand on the break, reduces trade count and removes a disproportionate share of losses.
Stops cluster immediately beyond obvious levels, so price frequently reaches marginally past before reversing. The filter exists to separate that from a genuine break.
Setup Two: Retest Entry
After a break, wait for price to return to the broken edge and hold. The trigger is the hold; invalidation is a close back through the level.
This gives a better entry price and a tighter invalidation than chasing the break, at the cost of missing moves that never retest. In instruments with wide spreads that trade-off usually favours waiting.
Setup Three: Trend Pullback
Once a direction is established, wait for a partial retracement and enter with the prevailing move. Invalidation sits beyond the retracement’s extreme.
It fails at turning points, where what appeared to be a pullback becomes a reversal, and it produces frustration in strong sessions where the pullback never arrives.
Setup Four: Range Fade
In a rangebound session, enter against a move as it reaches an established boundary. Invalidation is a hold beyond the boundary.
Its premise is that boundaries hold, so a genuine breakout produces a loss on a position taken precisely because price reached an extreme. Firm invalidation matters more here than anywhere.
Setup Five: Momentum Continuation
Where an instrument is moving strongly with heavy participation, enter in that direction and exit when participation fades rather than at a fixed target.
The weakness is entry price: by the time momentum is obvious, much of the move may have occurred and the required invalidation distance is correspondingly wide.
Why Momentum Demands Smaller Size
A wider invalidation distance means a smaller quantity for the same risk. Traders who keep their usual size on momentum entries are silently taking more risk than on any other setup.
This is the most common sizing error attached to a specific setup rather than to a specific instrument.
Setup Six: Level Reaction
Mark prior session extremes, the overnight range and recent congestion before the open. Enter on a reaction at a level rather than on price reaching it.
Invalidation is beyond the level treated as a zone rather than a line, since a small overshoot is normal and treating it as failure produces repeated avoidable exits.
Every Setup Needs a Session Classification
Breakout and pullback setups need directional sessions. Range fades need boundaries that hold. Applying either outside its conditions produces losses reliably.
Classifying first and selecting second is what makes a small set of setups sufficient, as covered in intraday trading strategies.
Match the Setup to the Session Phase
The opening carries the widest movement and spreads, the middle is quieter with weaker follow-through, and activity returns toward the close.
Breakout setups suit the opening and struggle at midday; range fades are the reverse. The phase is part of the setup’s conditions rather than a separate consideration.
Every Setup Needs a Time Limit
A trade that has not worked within the timeframe its setup implies has usually failed, whether or not the invalidation level was reached.
Time is a cost intraday, and a position doing nothing consumes attention and risk without progress.
Size Comes From the Invalidation Distance
Measure the distance to invalidation, then compute the quantity that makes the resulting loss an acceptable fraction of capital. Size is the output of that calculation.
Because setups differ in invalidation distance, they differ in position size. Applying one habitual quantity across all of them means taking different risk on each without deciding to.
Adjust for the Instrument
A concentrated benchmark travels considerably further in a session than a broad one, so the same setup requires wider tolerance and a smaller quantity there.
Derive size from each instrument’s own recent range, as the contrast in Bank Nifty intraday tips describes.
Cost Determines Which Setups Are Viable
Brokerage, exchange charges, levies and the spread apply to every round trip. A range fade in a narrow session may barely clear them even when it works.
Compute the round-trip figure and require the expected move on each setup to clear it comfortably, which eliminates some setups on some instruments entirely.
Where the Position Is Expressed Matters
The same setup taken in the cash segment, in futures or in options carries different risk and different cost. Options add decay that no directional setup accounted for.
Fix that choice as part of the setup rather than per trade, as options intraday tips sets out.
Do Not Run Correlated Setups Simultaneously
The same setup triggering on two correlated instruments is one signal, not two. Acting on both doubles the position rather than diversifying it.
Assess net directional exposure before adding anything, as covered in index intraday tips.
Record Which Setup Produced Which Result
Tag every trade with the setup used. Over a sequence this frequently reveals that one setup carries the results while another quietly consumes them.
That separation is invisible in an aggregate figure and directly actionable once seen, as described in evaluating trading strategies.
Start With One, Not Six
Applying a single setup consistently generates the evidence improvement depends on. Rotating between them resets the sample each time.
Add a second only once the first has enough trades to be judged, following the routine in the intraday trading guide.
Gaps Are Their Own Setup
An opening away from the previous close reflects information arriving outside market hours. Some fade as the reaction is absorbed; others begin a sustained directional session.
Trading a gap on the assumption it must fill is a costly habit. Waiting for the first structure to form and trading the confirmation is the tradable version.
Each Setup Needs Its Own Cost Test
A range fade in a narrow session may barely clear its round-trip cost even when it works, while a momentum entry with a wide invalidation may clear it easily.
Run the arithmetic per setup rather than once for the account, since the same cost figure eliminates some setups entirely while leaving others viable.
FAQs
Why describe setups precisely?
Because a rule that cannot be stated in a sentence cannot be reviewed. A defined setup that fails is information; an impulse that fails teaches nothing.
When does an opening range break fail?
In rangebound sessions, where the break is marginal and reverses. Requiring a hold beyond the edge rather than a touch removes many of these.
Why enter on a retest rather than the break?
Better price and tighter invalidation, at the cost of missing moves that never retest. In wide-spread instruments that trade-off usually favours waiting.
Why does momentum need smaller size?
Because the invalidation distance is wider by the time momentum is obvious. Keeping the usual quantity silently increases the risk taken.
Should levels be treated as lines?
No, as zones. A small overshoot beyond a widely watched level is normal, and treating it as failure produces repeated avoidable exits.
How many setups should I use?
Start with one. Rotating between several resets the sample each time, so none accumulates enough trades to be evaluated.
Does the same setup work on every instrument?
The logic transfers; the parameters do not. A concentrated benchmark needs wider tolerance and smaller quantities than a broad one.
Should gaps be traded on the assumption they fill?
No. Some fade and some begin a sustained move. Waiting for the first structure to form and trading the confirmation is the tradable version.