Opening Range Breakout Strategy for Beginners

This story details observations while trading the ORB on short-term time frames such as 1-minute, 5-minute, and 15-minute price charts.

The Opening  Range

There are various definitions of what the opening range means, but the most common is that it refers to the gap between the low and high price of the first 30 minutes of trading.

Position Sizing

The goal is to normalize the trader’s risk on each trade, so trading a high-price stock is no riskier than a low-priced stock.

It’s simple to identify the opening range by looking at the high and low of a candle.  But how should the trade be managed? There are three things the trader can do.

Three Approaches to Trading the Opening Range Breakout

Fixed Risk, Fixed Target

A fixed risk and fixed target simplifies trade management. You place your stop-loss one tick below the opening range breakout low and leave it there.

Fixed Target, Trailing Risk

You entered the trade by trading the breakthrough of the reference candle’s high, you’re long, and your stop-loss is placed.

Fixed Risk, No  Target

If you hit a home run, using a fixed risk per transaction with no defined target can result in significant returns.

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