The first 5-minute candle breakout trades a break of the day's first candle. It buys when a later 5-minute candle closes above that high and sells short when one closes below its low, with the stop at the other side of that candle. It takes one trade a day and closes out five minutes before the bell.
The numbers
| Net result | -1.7% ($9,834) |
|---|---|
| Trades | 631 |
| Win rate | 33% |
| Average win | +0.5% |
| Average loss | -0.2% |
| Biggest drop | -10.1% |
| Just holding | +46.4% ($14,640) |
| Biggest drop holding | -21.1% |
The average trade made -0.002% over 631 trades. Luck could explain that.
Year by year
Here is each year of the run, the strategy next to just holding.
| Year | Strategy | Just holding |
|---|---|---|
| 2024 | +0.2% | +12.6% |
| 2025 | -1.1% | +17.0% |
| 2026 | -0.8% | +11.8% |
The first and last years cover only part of the year.
The same rule on other stocks
The first 5-minute candle breakout beat just holding on one of the five stocks we ran it on.
Same rule, other stocks:
The backtest is public. Anyone can open it and check the trades.
How we tested
We ran the textbook rules on 5-minute candles on SPY from Mar 26, 2024 to Sep 30, 2026, in the same Backtest tab you can use. $10,000, all in on every trade, no margin. Commission is $0.005 a share and slippage is a cent a share, on every fill. A position still open on the last day is counted at that day's close.
Just holding buys SPY on the first day of the test and keeps it to the end. It counts the stock's price only, not dividends.
Questions
Does the first 5-minute candle breakout beat buying and holding SPY?
No. It finished at -1.7% against +46.4% for just holding SPY over the same dates.
Can I test it on a different stock?
Yes. Press "Try it yourself" to open the Backtest tab with the first 5-minute candle breakout already loaded, then change the stock. Without a paid plan you can reach less history than we used, and your numbers can differ.
Can I check the numbers myself?
Yes. Open the backtest we ran and every trade is listed there, no account needed.