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Keep the Opening Plan Simple – YourTradingCoach.com

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Common complaints about the market open:

  • It’s too fast!
  • It’s too volatile!
  • There is too much uncertainty!

I get it. And perhaps these traders are best just standing aside. Allowing some structure to develop and THEN trading.

But here’s what I think.

They’re missing an important point.

YOU can create SIMPLICITY within that uncertainty by predefining and setting limits to your action.

IF price does “this” AND does it in a way that makes sense THEN I will trade this setup.

One or two scenarios are sufficient.

And IF that doesn’t happen, THEN I’ll stand aside, allow some structure to develop and then trade.

You don’t have to know with any degree of perfection, how price will behave. That’s not how this game works. Just identify one or two opening scenarios that contain edge. Pre-consider them. And if they play out as anticipated, then get on board.

Otherwise, wait. And reassess after the market structure and conditions have revealed themselves.

Here’s Friday 17th March:

<image: Keep the Opening Plan Simple>

I would absolutely LOVE to see the trend continue one more day.

But then in the back of my mind…

Uncertainty point 1: Trend days are often followed by rangebound oscillations.

Uncertainty point 2: It’s Triple Witching Day… often more choppy and rangebound.

Uncertainty point 3: And we’re opening in an area with a whole lot of S/R congestion.

<image: Keep the Opening Plan Simple>

So let’s create SIMPLICITY within this uncertainty by predefining and setting limits to our action.

While I expect rangebound oscillations to be a higher probability than trend continuation, they’re a lot harder to visualise with precision until structure starts to form. Trend continuation however, will be obvious to ALL market participants, should it start to play out.

So there are only TWO scenarios that interest me from the open.

IF price breaks the overnight high AND buying pressure holds the break THEN I will trade continuation entry LONG.

IF price breaks the overnight high AND fails to hold the break THEN I will trade reversal entry SHORT.

And IF neither happen, THEN I’ll stand aside, allow some structure to develop and then trade.

Simple.

The market will set up either a YTC Price Action Trader Sixth Principle BPB or First Principle PB continuation long. Or Sixth Principle BOF reversal short. Or else I sit back and wait till new structure develops and new opportunity presents itself.

<image: Keep the Opening Plan Simple>

<image: Keep the Opening Plan Simple>

<image: Keep the Opening Plan Simple>

<image: Keep the Opening Plan Simple>

<image: Keep the Opening Plan Simple>

Uncertainty is inevitable. It’s the nature of the markets.

Simplicity in plan though… that’s a choice.

You can create simplicity within the uncertainty by predefining and setting limits to your action.

Happy trading,

Lance Beggs

 


 

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