Fat Day-trader


Nasdaq 100 Trading Strategy

Fat Day Trader

November 23, 2023

6 min read

Recognizing your aspirations for success, I am pleased to present a comprehensive Nasdaq 100 trading strategy.

Chances are, you're already familiar with what the Nasdaq is. So there is no need for lengthy explanations here. What's crucial to understand is that it's a highly volatile stock market index, offering the potential to earn substantial profits through trading.

That is, if you have the right strategy in place and know what you are doing..

To implement this Nasdaq 100 trading strategy, you'll require a trading account with a broker that allows Nasdaq trading.

Personally, I've been using TIOmarkets for approximately a year, and they offer all the necessary tools for executing the strategy I'll be demonstrating.

Setting up the Nasdaq 100 trading strategy

If you haven't registered with them yet, you can open an account here. For those already set up, ensure you have a clear chart to navigate the Nasdaq 100 trading strategy.

Begin by clicking "insert" at the top left of the trading platform. Navigate to indicators, select “trend”, and then click on the moving average indicator.

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Now, the goal is to incorporate a 10-period simple moving average. Adjust the parameters and click OK.

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Next, repeat the process to introduce a 50-period simple moving average. However, this time, opt for a distinct color to facilitate differentiation between the two.

Once more, repeat the process to include a third moving average. Set the period to 200 and choose a different color.

To sum it up, the desired outcome on the chart is three simple moving averages, each with a unique color: one calculating the average price for the last 10 periods, another for the last 50 periods, and the third for the last 200 periods.

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This process helps us in recognizing the short-term (orange line), medium-term (blue line), and longer-term (red line) trends. The way this Nasdaq 100 trading strategy works is by looking for trading signals in the direction of trend. These moving averages will help us with that.

This strategy is designed to be so simple that even beginners can grasp and apply it. The only requirement is an ability to read charts and identify trends.

How the Nasdaq 100 trading strategy works

When the price is above all three moving averages, adopt a bullish perspective. This implies a focus on seeking buying opportunities only.

Conversely, when the price is below all three moving averages, adopt a bearish perspective. This suggests concentrating solely on identifying selling opportunities.

By comprehending and applying this approach to your trading, you'll already be outperforming the average trader.

Many individuals who venture into trading lack a structured methodology and often find themselves on the wrong side of the market. Alternatively, some attempt to trade every market fluctuation, leading to troublesome outcomes.

The key is to identify the trend and trade in its direction. In the trading community, a well-known saying emphasizes that "the trend is your friend," and for good reason. This is what will improve your probabilities of success.

Trading signals for when to buy or sell

When the price surpasses all three moving averages, focus solely on identifying opportunities to buy. The buy signal occurs on the first candle that closes above all three moving averages. You can buy on the open of the next candle.

If the initial candle closes above all three moving averages, marking the signal, as soon as the next candle opens you can proceed with the buy.

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Conversely, when the price falls below all three moving averages, concentrate exclusively on opportunities to sell.

The sell signal occurs on the first candle that closes below all three moving averages. Execute the sell order at the opening of the next candle.

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What to do with false signals

Addressing false signals is a crucial aspect of trading. What should you do if the price starts moving in the opposite direction? This is where effective risk management comes into play.

It's essential to understand that no trading system can guarantee winning signals 100% of the time. Every trading system experiences losing streaks.

The key is to establish rules that limit losses while simultaneously seeking to maximize profit potential.

Let me guide you through some approaches using stop-loss placements and profit targets.

If the price crosses and closes above two out of the three moving averages, it might be good to close the trade and accept a small loss.

Evaluate the market's structure

If you buy and the market is going to trend in the direction of your trade, it should make higher highs and higher lows.

If the price deviates from this pattern, it's advisable to cut losses and preserve capital for the next opportunity.

A logical place to put your stop loss would be below the most recent swing low. If that also coincides with the other side of two or three moving averages then that's a good place.

This principle holds for both buy and sell signals. The moment the signal is invalidated, just cut your losses short.

Potential profit targets

I've got two techniques that can enhance your trading approach.

The first technique allows you to let the profitable trades run. As long as the price continues to trend in your favor, you stay in the trade.

With patience and discipline, allow the trade to unfold, and exit when the price crosses and closes above or below two out of the three moving averages.

If you follow this approach, it can lead to capturing substantial trading opportunities.

The second technique involves aiming for a support or resistance level.

While this method requires a degree of discretion, placing a take-profit order at the most recent historical support or resistance level has proven effective for me..

Admittedly, there may be instances when the price doesn't reach the expected level, but in such cases, you can fall back on the first technique.


This Nasdaq 100 trading strategy for the index is simple, and it can also be used in any market and on any time frame. Select one that suits your comfort level and give it a try.

For those who enjoy fast action and prefer more frequent trading, the 15-minute timeframe is an ideal choice.

If constant chart monitoring is impractical, redirect your focus to higher time frames.

Feel free to adopt the system as is, or personalize it to align with your preferences. The core principles of the strategy remain robust.

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