Opening Range Breakout

Start with the 30-minute range (8:00-8:30 AM). It's the most commonly used and provides a good balance between signal timing and reliability. Once comfortable, you can experiment with 15-minute (more signals, more false breakouts) or 60-minute (fewer signals, more reliable).

There are different approaches. Immediate entry captures the full move but has more false breakouts. Waiting for a candle close filters some fakes. Waiting for a retest has even better filtering but misses many trades. Start with candle close confirmation for balance.

If one side breaks, gets stopped out, then the other side breaks - that's two separate trades. Some days are 'chop' days with multiple false breakouts. If you get stopped twice, consider stopping for the day on that instrument. These are ranging days.

Optimal range is 20-40% of the typical daily range (ATR). For FTSE with 80pt daily range, a 20-30pt opening range is good. Too small (<15%) means noise and false breakouts. Too large (>50%) means most of the day's move already happened.

Yes, ORB is an intraday strategy. Exit all positions before market close (by 4:00 PM on LSE). Holding overnight exposes you to gap risk and the next day's opening range will be different. Close positions and start fresh each day.

Trending day signs: Gap at open, price stays one side of VWAP, early momentum sustained, ADX > 25. Ranging day signs: No gap, price crosses VWAP multiple times, choppy action, ADX < 20. By 30-60 minutes in, you should have a good read.

News can create powerful breakouts (good) or unexpected reversals (bad). If news creates the gap/range, breakout may follow. But news during the session can reverse your position. Be aware of economic calendar and consider tighter management on news days.

After breakout, place limit order at the broken range edge. If price pulls back to your limit, you get a better entry. Set stop just beyond the range (other side). If price doesn't retest, you miss the trade - accept that as the cost of better entries on trades you do take.

Full range stop gives more room but lower R:R. Mid-range stop is tighter with better R:R but gets stopped out more. Test both - mid-range often works better statistically (higher R:R compensates for lower win rate). Personal psychology matters too.

Yes, and it's often beneficial for diversification. Scan your universe at range end, rank setups, take the best 2-4. Watch correlation - don't be 100% long if all signals are long (same sector risk). Track which instruments give best ORB results.

Base it on volatility. If VFTSE is elevated (>25), use shorter range (15-20 min) - direction establishes quickly. If VFTSE is low (<15), use longer range (45-60 min) - need more time for meaningful range. Can also use ATR percentile at open.

For directional plays, buy ATM options on confirmed breakout with 1-2 DTE. 0DTE works but has extreme theta risk if breakout is slow. Alternative: buy straddle before range forms - expensive but profits from either direction. Credit spreads can work for collecting premium if expecting false breakout.

Need minute-level data. Calculate range from exact period bars (no lookahead). Apply realistic slippage (3-5 pts on breakout entries). Test across market regimes. Segment by day type. Walk-forward validate. Check that parameters aren't over-optimized.

Each instrument has different characteristics. FTSE may work with 30-min range, 1.5x target. A UK stock may need 60-min range, 1x target. Backtest each instrument separately. Track results by instrument. Some instruments simply don't work well with ORB - exclude them.

Skip when: ADX < 20 (ranging day expected), range is > 50% of ATR (move already happened), major scheduled news during session, multiple false breakouts already occurred (chop day), volatility is extreme (unpredictable), or your filters show low score.