The trading day ends, you carry no ES overnight,except on rare occasions you never trade before the 0930 EST opening.
So, with no watching, caring, opinions, bias etc about mkts once the day is over what is one to do in the morning once the pit session opens? What are you to do regardless of what the overnight Globex throws at the opening? You also care less about gaps.
You simply start the day with a mechanical cut and dried trade. There are many ways to trade the ORB. (opening range breakout)
Why trade the ORB? My reasoning was common thinking and confirmed by reading others ideas of the ORB. (yes, overnight electronic sessions have stolen some of the RTH thunder but i disregard all that as mox-nix and just trade the ORB the same regardless what globex) does.
Consider this: the 0930 est bell rings and you have no idea and care less which way the mkt will go. But you do know you want in on the action. When the bell rings you know this for sure = "The days pit session range has not yet been established" Your goal is to catch that range, you want some of the daily meat the butchers throw out to the display case. You as a seasoned or even beginning trader can get your share by using the ORB. KISS works best for this trade, no rocket science or crayons needed.
Again many different versions of trading the ORB. I will tell mine and you can adjust it to your own personality.
I use a 5 minute ES chart with no indicators to give me reasons NOT TO TAKE A TRADE. Indicators are distractions, traders get paid by being correct on price, not on how complicated the chart is.
Let the ES open at 0930 EST and wait 5 minutes. The first price indicated at the start of the second 5 minute bar is called "DA LINE" thats a line that is imprinted in the head or if desired can be drawn across the chart for the next hour. Ok, now you count 6 ticks (1 & 1/2 handles) above and below "DA LINE". When price touches the +6 line you go long, when price touches the -6 line you go short. You do not trade between the lines. That area of 12 ticks is what i call a DEAD ZONE. When you go long at +6 or short at -6 the boundaries on the other sides are your worst case STOP LOSS spots. Myself i usually bail out at 4 to 6 ticks against me. mkt action is a subjective matter as to when you bail out on a loser.
Best to get out of a loser fast because the ORB can be a tough trade to control if the mkt is in whipsaw mode early on. Many might want to do DA LINE at 15 minutes as a start, (rather than wait 5 minutes) subjective as always. Some mornings the trade will work on first try and BOOM you might get a bunch of handles and maybe even 1 trade for a dandy one-way day beauty. Avoiding whipsaws is gonna take experience but thats again why you take losers fast, a couple losers can be wiped out real fast once you catch a "RUN".
Ok, say you determine the opening is whipsaw and you sit back and wait. What to do? I do this: i wait for the first hour to pass and then take the breakout of the first hour. There are always times to change tactics. If a whipsaw day, switch to range trading mode.
The IDEA of the ORB is you want to be there when the mkt puts in the daily range. Your goal is to catch one or 2 swings a day. The start of the day is why everyone is in attendence, they want some of the meat being offered to us wolfs. ..
So, with no watching, caring, opinions, bias etc about mkts once the day is over what is one to do in the morning once the pit session opens? What are you to do regardless of what the overnight Globex throws at the opening? You also care less about gaps.
You simply start the day with a mechanical cut and dried trade. There are many ways to trade the ORB. (opening range breakout)
Why trade the ORB? My reasoning was common thinking and confirmed by reading others ideas of the ORB. (yes, overnight electronic sessions have stolen some of the RTH thunder but i disregard all that as mox-nix and just trade the ORB the same regardless what globex) does.
Consider this: the 0930 est bell rings and you have no idea and care less which way the mkt will go. But you do know you want in on the action. When the bell rings you know this for sure = "The days pit session range has not yet been established" Your goal is to catch that range, you want some of the daily meat the butchers throw out to the display case. You as a seasoned or even beginning trader can get your share by using the ORB. KISS works best for this trade, no rocket science or crayons needed.
Again many different versions of trading the ORB. I will tell mine and you can adjust it to your own personality.
I use a 5 minute ES chart with no indicators to give me reasons NOT TO TAKE A TRADE. Indicators are distractions, traders get paid by being correct on price, not on how complicated the chart is.
Let the ES open at 0930 EST and wait 5 minutes. The first price indicated at the start of the second 5 minute bar is called "DA LINE" thats a line that is imprinted in the head or if desired can be drawn across the chart for the next hour. Ok, now you count 6 ticks (1 & 1/2 handles) above and below "DA LINE". When price touches the +6 line you go long, when price touches the -6 line you go short. You do not trade between the lines. That area of 12 ticks is what i call a DEAD ZONE. When you go long at +6 or short at -6 the boundaries on the other sides are your worst case STOP LOSS spots. Myself i usually bail out at 4 to 6 ticks against me. mkt action is a subjective matter as to when you bail out on a loser.
Best to get out of a loser fast because the ORB can be a tough trade to control if the mkt is in whipsaw mode early on. Many might want to do DA LINE at 15 minutes as a start, (rather than wait 5 minutes) subjective as always. Some mornings the trade will work on first try and BOOM you might get a bunch of handles and maybe even 1 trade for a dandy one-way day beauty. Avoiding whipsaws is gonna take experience but thats again why you take losers fast, a couple losers can be wiped out real fast once you catch a "RUN".
Ok, say you determine the opening is whipsaw and you sit back and wait. What to do? I do this: i wait for the first hour to pass and then take the breakout of the first hour. There are always times to change tactics. If a whipsaw day, switch to range trading mode.
The IDEA of the ORB is you want to be there when the mkt puts in the daily range. Your goal is to catch one or 2 swings a day. The start of the day is why everyone is in attendence, they want some of the meat being offered to us wolfs. ..
