Open Break Plays
- Thread starter William
- Start date
Funny guy that Chuck. I would be interested in reading contributors on this topic, too.
what is an open break
open break is it something the knicks do? like a fast break?
from the looks of the board, bright does more typing than trading
Orders on Open? Ok
from the looks of the board, bright does more typing than trading
Orders on Open? Ok
Jordan and I passed a couple messages to each other, here is what I replayed with :
1. So far I have a lot of random thoughts on the matter. I have yet to see it clearly though.
First, I have come to the conclusion that it is better to play open breaks then not to. My reasoning is this - profit potential on a trending day can be very big. I mean, if you catch a move early on (the open) then you have the chance to ride it for a point or two during the rest of the day. So this makes the risk / reward very favorable. And even if it is not a very trending day, if you find a stock that has created a tight range during the first five or so minutes and play the break of it's high / low then you wont even need a point... say it creates a range of 30 cents, then even a 60 cent move would create a 2 -1 rr. This, in my opinion, is what makes the opening break a nice play - the risk reward. Probabilities are not so great. So the important thing here is to let winners ride, or else it won't be worth it.
I've noticed patterns that work well are descending triangles, ascending triangles, and a U ish shaped move.
2. I think tape reading / pattern set up is the key. I say this because from past research I've done, there have been months where the five minute break worked very well, and others did not. And then there have been months where the opposite is true. But out of all the breakouts I think the thirty minute on is the most reliable in whole, but you sacrifice risk - reward ratio sometimes if the range is too wide.
Another thought is that when I see a setup during the open, I would like to see cup and handle rather than just a cup because I can place my stop at the handle instead of the cup. So this way I get a tighter stop.
1. So far I have a lot of random thoughts on the matter. I have yet to see it clearly though.
First, I have come to the conclusion that it is better to play open breaks then not to. My reasoning is this - profit potential on a trending day can be very big. I mean, if you catch a move early on (the open) then you have the chance to ride it for a point or two during the rest of the day. So this makes the risk / reward very favorable. And even if it is not a very trending day, if you find a stock that has created a tight range during the first five or so minutes and play the break of it's high / low then you wont even need a point... say it creates a range of 30 cents, then even a 60 cent move would create a 2 -1 rr. This, in my opinion, is what makes the opening break a nice play - the risk reward. Probabilities are not so great. So the important thing here is to let winners ride, or else it won't be worth it.
I've noticed patterns that work well are descending triangles, ascending triangles, and a U ish shaped move.
2. I think tape reading / pattern set up is the key. I say this because from past research I've done, there have been months where the five minute break worked very well, and others did not. And then there have been months where the opposite is true. But out of all the breakouts I think the thirty minute on is the most reliable in whole, but you sacrifice risk - reward ratio sometimes if the range is too wide.
Another thought is that when I see a setup during the open, I would like to see cup and handle rather than just a cup because I can place my stop at the handle instead of the cup. So this way I get a tighter stop.