For those interested in testing this (or anything other) trading method, a great way to start is to test the entries against random. There are many ways to do this. What I do is calculate what I call the "BS" (better-than-stupid) ratio. A BS Ratio of one (1.0) means no better than random. Actually, with the spread, for the eminis the BS Ratio for random is more like 0.95. Anyway, here's how to do it: (1) Decide on three stop loss values: small, medium, and large. For NQ I use 3,5, and 7 points. (2) For each entry, find the MFE (maximum favorable excursion) before it hits the stop, for all three stop values. (IF you don't already know, MFE is the most profit possible you could have made from that entry before it hit the stop.) (3) Do step two for a lot of trades (the more the better). (4) Now add up all the MFE's. Divide by the sum of all the risks (just stop value times number of trades). Do this for all three stop values. For daytrading it seems a BS ratio of 1.3 - 1.5 is pretty good. A swing trader once told me he had a BS ratio of 4. P.S. if anyone writes a computer program to do this, with time and sales as input... please send me a copy!!