📖 THE DOOMTRADER STRATEGY

THE CORE IDEA

Major economic data releases — CPI (Consumer Price Index), NFP (Non-Farm Payrolls), and PCE (Personal Consumption Expenditures) — create predictable volatility explosions in NQ futures. Instead of guessing direction before the data drops, we capture the breakout move after the release using a systematic, rules-based approach.

STEP 1: PRE-NEWS RANGE (8:00 - 8:29 AM ET)

Before the 8:30 AM ET data release, we record the high and low of NQ from 8:00-8:29 AM. This range represents the market's pre-news equilibrium. Markets often compress before major releases, creating a tight range that breaks explosively once data hits.

STEP 2: BREAKOUT ENTRY (50-POINT THRESHOLD)

After the data drops at 8:30 AM, we wait for a confirmed 50-point breakout beyond the pre-news range. If price breaks 50 points above the high → LONG. If price breaks 50 points below the low → SHORT. This filter eliminates false breakouts and ensures we only enter when the market has committed to a direction.

STEP 3: POSITION SIZING (3 CONTRACTS)

We enter with 3 contracts:

• Contract 1 & 2: Take profit at +100 points ($2,000 per contract)
• Contract 3 (Moon Bag): Trails with a stop, rides extended moves

STEP 4: THE MOON BAG 🌙

The moon bag is the secret weapon. After taking profit on 2 contracts, the 3rd contract stays open with a trailing stop. On big data surprises, NQ can move 200-400+ points. The moon bag captures these outsized moves risk-free (since profits from the first 2 contracts cover the initial risk).

In 2025 backtesting, moon bags added +$46,200 in additional profit.

RISK MANAGEMENT

• Stop loss: 50 points from entry (opposite side of range)
• Max risk per trade: $1,000 per contract ($3,000 total)
• Risk/reward: minimum 2:1
• Only 3-5 trades per month (high selectivity)
• No trading outside of CPI/NFP/PCE events

WHY THIS WORKS

• Predictable volatility: CPI/NFP/PCE always cause big moves
• No directional bias: We react to data, not predict it
• Confirmation filter: 50-point threshold eliminates noise
• Asymmetric upside: Moon bags capture the big outlier moves
• Low frequency: 3-5 trades/month reduces overtrading risk