Keep it Simple!

Day trading the opening range (OR), yet again. Hey it works for me, so I will continue to trade it. I think most traders fail because they focus on too many things at once. For me, I like to keep things simple! I like to devote my attention to particular setups, ones I understand, and execute to my best ability.

Lets take a look at FSLR. The stock opens significantly higher from the closing price, we call this a "gap up." I like to use the premarket movers from The Kirk Report, to scan for this trait.

Once the market opens, I wait for a pullback (meaning a decline in price), then I wait for the stock to shoot past the first candlestick (opening range). This is where I enter, via the first purple circle.

Notice I have highlighted the word wait. Patience is key, without it, you don't stand a chance.


Now comes the hard part, when do I sell? The answer can vary, and is really up to you. Many people plot fibonacci lines, set specific price targets, use the MACD, RSI, support lines, ect. I will keep it simple, for the sake of beginners, and tell you to watch the Exponential Moving Average (5). I use the EMA (5) as my support, once broken, it's usually time to exit the trade.

Looking at the chart, Do you see the second purple circle? A huge red candlestick right through the EMA (5)-- time to sell.

I make it sound easy, but in reality it is not always this simple. There are many factors you must consider before entering and exiting, but I will save that for a later post.

My point is, keep it simple! Find what works for you, master it, and move on.

Here is another stock I traded today. Notice the break in the OR, followed by a huge surge in price-- beautiful! These setups happen all the time, you just have to find them.


Want to learn more about candlesticks? Check out Trader X, WallStreet Warrior, and Bluedog. I am still learning myself.