{"id":483,"date":"2009-04-01T17:31:24","date_gmt":"2009-04-01T22:31:24","guid":{"rendered":"http:\/\/www.smbtraining.com\/blog\/?p=483"},"modified":"2009-04-01T17:31:24","modified_gmt":"2009-04-01T22:31:24","slug":"on-the-open","status":"publish","type":"post","link":"https:\/\/www.smbtraining.com\/blog\/on-the-open","title":{"rendered":"On the Open"},"content":{"rendered":"

Often new traders state, “I can’t trade the Open.” \u00a0And then they decide to just watch for the first 15 minutes of trading. \u00a0But doing this eliminates some easy money for you. \u00a0And understand it is not that you cannot trade the Open, it is that you trading the Open poorly. \u00a0But there are certain set ups<\/a> that offer an excellent risk\/reward that you should exploit. \u00a0Let’s discuss one of them.<\/p>\n

APOL gapped down on the Open. \u00a0It opened near 71. \u00a0APOL opened below its closing price in the After Hours of around 74. \u00a0This is a sign of weakness. \u00a0 APOL opened lower than its low in the After Hours of around 72.46. Opening below this low is another sign of weakness. \u00a0APOL is one of the few stocks that has held up well during this market rout. \u00a0Thus it has more downside than most stocks.<\/p>\n

On the Open APOL failed to hold 71. \u00a0It’s first ticks were down. \u00a0Considering the points I made in the paragraph above and combining this with its failure to hold 71 on the Open, APOL offered an excellent risk\/reward shorting opportunity. \u00a0A short below 71 would have offered you a quick 1 1\/2 point downmove to 69.50. \u00a0 It went down so fast you would have had little opportunity to cover APOL too quickly right after it dropped 71. \u00a0This would have been a chop.<\/p>\n

During the internet boom one of my favorite trades was to buy Internet stocks that had gapped down on the Open, whose first ticks were up when they opened. \u00a0Since the market was so strong these stocks tended to bounce. \u00a0Sometimes they filled the gap. \u00a0Sometimes they bounced but then slowed before the gap was filled. \u00a0Sometimes they headed lower in which case you needed to quickly flip your position. \u00a0But if you were nimble a quick 10k was likely before 9:45AM. \u00a0<\/p>\n

If you are struggling on the Open do not give up this time period. \u00a0It is not that the Open is not a good trading period, in fact, it is the best statistically for an intraday trader. \u00a0But you must measure your risk appropriately, and you must find set ups that offer excellent risk\/reward opportunities. \u00a0Often new traders poorly calculate their downside with trades right on the Open. \u00a0But a conclusion should not be drawn that trading the Open is not profitable. \u00a0The only conclusion you ought to draw is that you are doing a poor job of evaluating your risk directly on the Open.<\/p>\n

Over the years I have made a ton or money very quick right on the Open. \u00a0This is my favorite and most profitable period to trade. \u00a0Now I am quick so factor that in when considering my comments. \u00a0But you should develop some setups that are best for you on the Open. \u00a0And you should learn to exploit some easy set ups.<\/p>\n

Best of luck with your trading!\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"

Often new traders state, “I can’t trade the Open.” \u00a0And then they decide to just watch for the first 15 minutes of trading. \u00a0But doing this eliminates some easy money for you. \u00a0And understand it is not that you cannot trade the Open, it is that you trading the Open poorly. \u00a0But there are certain set ups that offer an … Read More<\/a><\/p>\n","protected":false},"author":144,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1,10],"tags":[260,30,18],"class_list":["post-483","post","type-post","status-publish","format-standard","hentry","category-general-comments-2","category-mike-bellafiore-bellas-blogs","tag-intraday-trading","tag-prop-trading","tag-smb-capital","no-post-thumbnail"],"yoast_head":"\nOn the Open | SMB Training<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.smbtraining.com\/blog\/on-the-open\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"On the Open | SMB Training\" \/>\n<meta property=\"og:description\" content=\"Often new traders state, “I can’t trade the Open.” \u00a0And then they decide to just watch for the first 15 minutes of trading. \u00a0But doing this eliminates some easy money for you. \u00a0And understand it is not that you cannot trade the Open, it is that you trading the Open poorly. \u00a0But there are certain set ups that offer an ... 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