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Opening Range: Why is it of Interest to Day Traders?

The opening range depicts the highs and lows of security prices for a specific time period after the market opens.

Day traders keep an eye on a stock’s starting range since it might give them a sense of the market’s mood and price trend for the day.

When technical analysts examine a chart, they look at the opening range as one of the multiple price ranges.

Trading ranges can be a useful indicator for technical analysts. The opening range generally reflects strength, weakness, or a sideways trend with no clear sentiment.

What Are Opening Range Breakouts?

The open sets the tone for the day’s trend and sentiment. However, it also has a statistical significance that is overlooked.

Because of the importance of the open and the probability of non-random price movement, the open, especially the opening range, provides us with numerous opportunities to develop trading methods.

Opening Range Breakout Screen

During this time, we must determine the day’s highs and lows. Identifying pre-market highs and lows serve as a magnet on price behavior once the stock market opens.

Trading the opening range simplifies things by providing entry and exit points. There are absolutely no grey areas when deciding where to stop.

An opening range breakout is a break from the opening range. The opening range is defined differently depending on your timeframe and testing.

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