I tried out the opening range setup recommended by Cobra at. The opening range (OR) setup typically uses the first 5 minutes or 30 minutes (10 o’clock) as the open range and enter trades on break of the range.
I got the beginner’s luck today trading SPY using the OR setup.
The first trade was on break of the first bar on the 5 minute chart, with the target being the length of the first bar. My target was missed by a hair and as price started to retreat, I took the exit. I was greedy in protecting my profit. I could have set my stop at breakeven to give the setup a bit more room. In hindsight, I would have gotten stopped out. So I might not have done the right thing, but I got away with this one.
The second trade was an old fashioned bad trade. I entered it on the red line (previous day’s close) and 20 MA support without confirmation. The traded was partially fueled emotionally by the fact that I left much on the table on the run-up. It was stopped out just below the bar where I entered the trade. Of course, that happened to be the local low, like most of my stops.
For the third trade, I executed the 10 o’clock OR setup and entered long at the breakout. I set the target at the measurement based on the opening rally — see the rectangles on the above chart — and the stop just below the low of the breakout bar. It went beautifully as planned. I eventually exited a bit early because of the vicinity to a pivot level (green dashed line).