The 'Daily Sweep' strategy changed my life forever, powering me to a world-record $2.5 million payout from Apex Trader Funding in April 2024. Before mastering this methodology, I was caught in the cycle of 'strategy hopping,' constantly jumping from one system to the next. That ended here. This approach is the last one I will ever need, and my goal today is to teach it to you in full. By the end of this, you’ll have a clear, mechanical system to help you escape the noise and finally achieve consistent profitability.
» Mark all hourly swing points that haven't yet been traded to from yesterday leading up to 8AM. If we are trading beyond yesterday's price action, use the next most recent day. «
Step One: Identifying Hourly Swing Points
Step one is deceptively simple, yet its precise execution is mandatory for the rest of the system to work. Every morning at 8:00 a.m. EST—ninety minutes before the US equity open—I sit down to map out the field. I meticulously mark every hourly swing point from the previous day leading up to the current session. If price action has moved beyond yesterday's range, simply pull data from the next most recent day. This pre-market routine ensures that by 9:30 a.m., I have a crystal-clear map of where liquidity is resting.
» By 9:30 a.m., I have a crystal-clear map of where liquidity is resting. « Higher highs and higher lows or lower highs and lower lows?
It is critical to perform this analysis exclusively on the one-hour timeframe. While intraday trading involves lower timeframes, we require the one-hour chart to serve as our higher timeframe anchor to guide our decision-making. In the context of the Daily Sweep model, the hourly chart provides the necessary indication of when we can begin hunting for specific setups. We do not descend into lower timeframes until we receive high-level confirmation on the hourly chart.
To understand this step, one must first master the technical definition of a swing point. A swing low is defined by a three-candle pattern where a specific candle’s low is flanked by two candles with higher lows. Once the third candle in the sequence closes at the top of the hour, the central low is officially validated as a bullish swing point. Conversely, a swing high occurs when a central candle is flanked by two candles with lower highs. Again, we must wait for the closure of the third hourly candle before that peak is confirmed as a bearish swing point.
These swing points are vital because they allow us to identify market structure. When the market creates higher highs and higher lows, it is objectively bullish; lower highs and lower lows indicate a bearish trend. In a trending market, opposing swing points will often fail as the trend continues. However, the market rarely moves in a linear fashion, and we frequently see short-term "runs" on these swing points—where the market raids a low to gather liquidity before continuing higher. As traders, we are not seeking 100% certainty; rather, we are making a high-probability educated guess, ideally with a 60% to 70% success rate, to align ourselves with the higher timeframe trend.
Step Two: The Swing Failure Pattern (SFP)
Once you have identified your major swing points, you must integrate the concept of the Swing Failure Pattern (SFP). Without this secondary layer, the identified swing points are merely arbitrary lines on a chart. An SFP occurs when the price briefly breaches a significant swing high or low but reverses rapidly, failing to sustain momentum and closing back within the previous range. This phenomenon indicates a liquidity grab or a potential trend reversal.
Bullish and Bearish Swing Failure Patterns: When price briefly breaks a significant swing high or low but quickly reverses, failing to sustain the move and closing back within the previous range, indicating a potential trend reversal or liquidity grab.
Why do they work? Instead of trying to anticipate the reversal, this provides confirmation that it is actually happening.
In the marketplace, liquidity often clusters around these swing points. Traders entering "long" positions typically place their protective stop-loss orders just below a swing low, while "short" sellers place theirs above a swing high. The SFP allows us to capitalize on the moment these stop-losses are triggered. We are looking for the market to run through a swing point and then show a definitive rejection in the opposite direction.
A key distinction must be made: the mere breach of a level is not an SFP. We require a strong closure back within the range for confirmation. For instance, if the market raids a swing low, we do not simply buy the moment the level is touched; we wait for a bullish hourly candle to close back above that previous low. This provides confirmation that the "Smart Money" has entered the market, allowing us to ride their coattails rather than attempting to front-run the move.
"In professional trading, you do not want to be the first person rushing through the door. Those who rush in first are often the ones who get shot. Waiting for confirmation allows you to capture the 'meat' of the move rather than obsessing over 'top-ticking' or 'bottom-ticking' the market."
My mentors at a major Chicago trading firm emphasized that this filter saves significant capital. In my earlier years, I lost thousands of dollars attempting to trade "Turtle Soups" or liquidity raids by entering as soon as a level was breached. I would often watch the price drift slightly further, trigger my stop loss, and only then move in my intended direction. By waiting for the hourly SFP closure, we ensure that the lows or highs we are trading against are protected by confirmed institutional activity.
Intraday Execution and Case Studies
Once an SFP is confirmed on the one-hour chart, you can transition to lower timeframes—such as the one-minute, five-minute, or fifteen-minute charts—to refine your entry. The goal is to anticipate that the next several hourly candles will trade in the direction indicated by the SFP.
NASDAQ (hourly charts): Setups and Trading Examples.
Looking at the NASDAQ (NQ) as an example (charts above), we can observe this pattern nearly every day. On a typical morning, if we identify a swing low and witness an SFP at the 8:00 a.m. candle closure, we can anticipate a bullish expansion during the New York session. In one specific instance, an SFP provided a move with a 3R (three times the risk) return on the hourly chart alone. If a trader were to refine that entry on a five-minute chart with a tighter stop-loss, the reward-to-risk ratio could be significantly higher.
Fair Value Gaps, Order Blocks, and Breaker Blocks.
It is important to note certain market conditions, such as holiday gaps. For example, during the period surrounding Thanksgiving and Black Friday, the lack of overnight data can make SFPs "sketchy" or unreliable. In such cases, it is often prudent to wait for the market to return to normal volume. However, on standard trading days, the pattern is remarkably consistent. Whether the market is trending or ranging, plotting the previous day's swing points and waiting for a session-open SFP—during either the London or New York sessions—provides a crystal-clear roadmap.
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I encourage you to perform your own "homework" by backtesting this on your charts. Plot your hourly swing points, identify the swing failure patterns, and observe how the subsequent hourly candles behave. This is the exact strategy I utilized to generate millions of dollars. While many traders have access to profitable strategies, they often fail due to a lack of discipline. I struggled for ten years before I was able to make this work, but by sticking to this one clear system, you can finally overcome the cycle of inconsistency.
Order Flow Cycle.
