An opening range is when the market opens at a particular time such as for the year, month, week and day or session in forex.The market sets a high, a low and reviets those highs and lows but fails to break through creating the range. I personally
need to see price test a level at least twice making a type of double top, double bottom forming the range. opening ranges are
the same concept as any other type of range, your ether playing inside the range or waiting for a breakout. once price breaks out
it becomes a trading opportunity and even more opening ranges can set a direction bias of the market.
The types of opening ranges:
I only trade the session and weekly Opening Range breakouts, the monthly and yearly OR breaks I only use for a longer
term bias. Trading the OR Breakout is always best to go in the direction of the trend.
Conventional Way To Trade The Bullish Opening Range Breakout:
-----Breakout-----
(1)Wait for a clear opening range to form.
(2)Buy a break of the top of range.
(3)Stop can be place below the range low or 50% retracement of bottom to top of range depending on risk - reward.
(4)Target should be structure based at a key resistance level each setup will be different.
-----PullBack-----
(1)Wait for a clear opening range to form.
(2)Buy a pullback at the breakout level.
(3)Stop can be place below the range low or 50% retracement of bottom to top of range depending on risk - reward.
(4)Target should be structure based at a key resistance level each setup will be different.
Conventional Way To Trade The Bearish Opening Range Breakout:
-----Breakout-----
(1)Wait for a clear opening range to form.
(2)Sell a break of the Bottom of range.
(3)Stop can be place above the range high or 50% retracement of top to bottom of range depending on risk - reward.
(4)Target should be structure based at a key support level each setup will be different.
-----PullBack-----
(1) Wait for a clear opening range to form.
(2) Sell a pullback at the breakout level.
(3) Stop can be place above the range high or 50% retracement of top to bottom of range depending on risk - reward.
(4) Target should be structure based at a key support level each setup will be different.
need to see price test a level at least twice making a type of double top, double bottom forming the range. opening ranges are
the same concept as any other type of range, your ether playing inside the range or waiting for a breakout. once price breaks out
it becomes a trading opportunity and even more opening ranges can set a direction bias of the market.
The types of opening ranges:
- Daily Or Session in forex open range - Assets traded on an exchange, Look for price to set an OR in the beginning of trade on
that exchange. Forex on the other hand watch for the open of the session to set a doble high, doble low and whait for the break.
Remember in trading the session Opening range breakout only trade currencies correlated to that session. This is an intraday
trade setup and can not be used for a longer term bias.
- Weekly opening range - In forex the weekly open begins on sunday at 5PM EST, From this time look for the market to set a
double high, double low marking the range. Remember that time is not an issue, to set a weekly OR it could take 1 day or a
couple of days the most important thing is that it set at least a double top & bottom befor the break. Once price breaks to one
side and there's a pullback that's supported, the breakout direction can now also be used as a bias for that week. a lot of times
there will be at least 2 impulse moves on a weekly OR break , an impulse move after the pullback consolidation and then
another impulse move usually the second impulse move is towards the end of the week.
- monthly Opening range - I personally don't use monthly OR much but they can give a directional bias for that month.
- Yearly opening range - which can be used to provide an overall direction for the year. Usually the first couple of months within
the year markets will make a large range trying to figure out where it should go Once that range breaks to one side it's a powerful
signal that price will continue in that direction for a while. Remember this is a longer term time horizon so yearly OR breaks can
lead into big moves.
I only trade the session and weekly Opening Range breakouts, the monthly and yearly OR breaks I only use for a longer
term bias. Trading the OR Breakout is always best to go in the direction of the trend.
-----Breakout-----
(1)Wait for a clear opening range to form.
(2)Buy a break of the top of range.
(3)Stop can be place below the range low or 50% retracement of bottom to top of range depending on risk - reward.
(4)Target should be structure based at a key resistance level each setup will be different.
-----PullBack-----
(1)Wait for a clear opening range to form.
(2)Buy a pullback at the breakout level.
(3)Stop can be place below the range low or 50% retracement of bottom to top of range depending on risk - reward.
(4)Target should be structure based at a key resistance level each setup will be different.
Conventional Way To Trade The Bearish Opening Range Breakout:
-----Breakout-----
(1)Wait for a clear opening range to form.
(2)Sell a break of the Bottom of range.
(3)Stop can be place above the range high or 50% retracement of top to bottom of range depending on risk - reward.
(4)Target should be structure based at a key support level each setup will be different.
-----PullBack-----
(1) Wait for a clear opening range to form.
(2) Sell a pullback at the breakout level.
(3) Stop can be place above the range high or 50% retracement of top to bottom of range depending on risk - reward.
(4) Target should be structure based at a key support level each setup will be different.