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Can an opening range be used to determine type of day?
Platform: NinjaTrader (It's a love/hate relationship)
Trading: CL, TF, 6E
Posts: 169 since May 2010
Thanks Given: 60
Thanks Received: 314
"Opening Price Principle" by Larry Pesavento is built entirely around research on how to trade the day based on opening range. Haven't read it myself, but it sounds like a nice source of information overload in response to a simple question.
There's also "The Importance of the Opening Price", by Earl Haddady
Can you help answer these questions from other members on NexusFi?
Platform: NinjaTrader (It's a love/hate relationship)
Trading: CL, TF, 6E
Posts: 169 since May 2010
Thanks Given: 60
Thanks Received: 314
Also, Toby Crabel's S&C articles, "Playing the opening Range breakout" repeatedly states that, according to his research, opening range breakout determines the direction of the day for at least the first few hours, if not the entire day. I've uploaded a copy to the downloads section.
"Playing the opening range breakout" by Toby Crabel. This is a collection of Stocks & Commodities articles. It's a good summary if you don't want to read his entire book.
Supposedly with Market profile one can determine the kind of day that it may be. I don't understand much about this aspect. The open can play a role as well as the initial balance (first hour).
I believe there are 6 day type in MP. Here is a link that explains a bit about them.
I have noticed in the TF, the prior day high or low be touched at some point in the day. Usually which ever is closer to the opening price in the NY market. If price opens above the prior day high, usually it continues higher, and vice versa if it opens below the prior days low.
This is true in TF, havent quite figured out what time of day to use in CL as the open/close since its a much more volatile market.
What is the logic behind 8:30 EST? The floor session opens at 9:00 AM EST.
With today's enormous volatility, prior low and high were of little help as a reference. The pre-session high created temporary resistance as it fell together with the noise bands.
The RTH volatility target was reached, the move stopped at the 3-day rolling pivot R3, as daily pivots were of little help, as all of them were located south.
I've noticed that CL starts moving well at 6:30 CST. I don't know if the big boys are setting their trading plans or what ... actually... I don't care why it moves ...
Just my $0.02 worth...
Regards,
TMFT
I'm just a simple man trading a simple plan.
My daddy always said, "Every day above ground is a good day!"
personally, I used to track CL starting from 7:00AM EST... I get up around 6AM EST daily... I noticed back in 12/2009 the market would start moving around that time ... I moved it to 8:30AM EST based on the logical trader method.. which is what I am using in conjuction with tape reading.
now, concerning the break to the tiny downside today, there was no reason to trade against the tide with the PVR being so far away and everything pointing to an up day.... assuming one did traded the A down.. and didnt take all variables into account, then the risk was 30 ticks.. realistically, the risk was about 10-15 ticks given the trade would have gone nowhere and I would have scratched it... to enter at 10:15AM EST @ 93.65 and let it ride until the trailing stop would have taken me out... overall, it would have been a good day... but I dont trade with this little volume, so I spent the day just playing with my kids, sleeping and catching up with reading that I needed to do...
