Simple day trading strategy: Opening range breakouts // Intraday stocks trading system, market tips, opening range breakout, opening range breakout strategy, opening range trading strategy, opening range breakout trading strategy, opening range breakout intraday trading system, opening range trade, opening range breakout system, opening range breakout forex, day trading opening range breakout, day trading open, opening range success formula, day trading strategies, day trading setup, day trading for beginners, day trading for dummies, day trading basics, day trading 101 david moadel
welcome to looking at the markets with
David Modell today we're going to look
at the opening range breakout day
trading strategy and this is not a
perfect strategy it's not a perfect
indicator it does not work a hundred
percent of the time but if you're
looking for a good solid usable strategy
that's really simple you can certainly
use this
ok so let's take a look at some examples
so i can show you this is ticker UNH
which is united healthcare and let's
define what the opening range means
right now it is the first half hour of
the trading day
alright so this is the beginning of the
trading day and this i know it says 10
but that does not mean ten o'clock it
means March 10
ok so it's actually the opening of the
day which is 930 a.m. eastern time so
this stuff over here this is not this is
not count because this is the the end of
the previous trading day so the opening
of the i'm going to consider the first
half hour
alright so it's from and these are five
this is the five minute
candlestick chart alright so each
candlestick represents five minutes of
price action and so if this is 930am and
this is 1045 then the first half hour a
half hour of the trading day would be
from here to about here so that would be
the opening what i would consider the
opening are the first half hour of the
day and the opening range would be how
high did it go and how loaded it go the
the high and the low of that first half
hour so if the low of that first
half-hour remember this stuff doesn't
count it'sit's from here to here so this
would be the low and this would be the
high of that first half hour
alright so that would be the opening
range
and so if the opening range is from here
to here then you're going to look it so
you wait for the first half hour
you just wait for that and then you mark
the below in the high of that opening
range and then you look for a breakout
either to the upside or to the downside
meaning you wait for the price action to
either break with conviction
ok meaning break you know strongly above
the high or strongly below the low of
the opening range the first half hours
opening range so after the first
half-hour the range was established and
then it started to go down but did it
break below the opening range know it
got close but then you know that was
kind of like a head fake because then it
went back up and it broke very
convincingly above the high of the
opening half hour range it broke above
it convincingly and if you bought
then you would have done nicely for the
rest of the day you would have done very
well okay and you probably want to use a
tight stop-loss here
ok you know because it could turn around
and if your day trader I hope you're
using some sort of a method to head your
trade such as a good stop loss
ok but if you had bought the opening
range breakout you would have done very
well let's look at another one word
broke above the opening range this is
ult a and there's a big opening range
here okay
again this is 10 but that's March tenth
it'sit's really 930am the opening of the
day and the opening range was it way
down here to about let's say way up
actually about about here was the
opening range so from down here to up
here and it did not break below the the
opening range of the first half hour of
the day not even close it immediately
immediately broke above it and if you
had bought that it went sideways for
awhile chopped around and then went up
ok so if you had a stoploss a little bit
below that it would not have you would
not have been stopped out it just would
have chopped around but if you'd stayed
in there you would have done quite well
and so that's those are two examples of
a convincing breakout above the opening
half hour range where you just hold onto
it and let it let it go up because
that's where the momentum is now we can
also break below the opening range of
the first half hour
ok so this is sby and it gapped up here
the first half hour was you know from
here to here
there abouts so if the the range was
from the low here to the high here okay
and then immediately started to go down
it never went up above the opening range
but certainly broke with conviction
below
look at all those red candles in a row
and so and it went sideways chopped
around if you had your stop-loss around
here it would not have would not have
been stopped out and went down down and
down okay and you have to take your
profits by the way otherwise you can see
how it can turn around and go against
you
ok but if you had taken your profits if
you had your profit target you would
have done well with this all right
because the momentum was to the downside
here is another example of the momentum
being to the downside the opening range
for AAA which is alcoa
would be lets say from here to about
here okay and then it broke with
absolute conviction below that very
quickly and by the way the sooner it
does it the better the sooner it breaks
with conviction either above or below
the opening half hour range the better
if it takes too long if the trading day
is almost over then it's not as there's
not as much conviction there it's also
good to look at the volume if there's
volume behind the breakout to the upside
or downside that's a good sign as well
okay but mainly i'm looking at the price
action how strongly is it going above or
below this is very strong look at those
big red candles and look how many red
candles in a row there are so went below
that opening range and you know you you
would have had a nice profit there
ok and you want to take your profits
because let's say went down here you
took your profits it could have gone
back up very easily it didn't but yeah
it's important to take your profits have
a profit target with every trade
ok here's us so which represents oil
and if if this is the ok gap down and
then from let's say hear about here if
if this is the high and this is the low
of the opening range
alright it went down below it and if you
had bought that that breakout or i
should say break down to the downside
below the opening range and held on you
could have had a stoploss around here
would not have been stopped out and you
could've profited quite well alright so
these are some examples of a very simple
day trading strategy involving the
opening range if you found this to be
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alright and if you have questions or
want to put together a trading plan for
your stocks or options trading or
investing you can email me at anytime my
email address is David Modell @
gmail.com
thank you so much for watching and
listening and i'll talk to you again
soon
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