I had no plans to continue the recent article series but the market had different ideas, so here we are!
First, if you missed the prior articles then see here – http://yourtradingcoach.com/trading-process-and-strategy/traps-just-before-rth-open/
And that brings us to today's sequence…
We'll start with a quick look at the prior day and overnight session, for a bit of "bigger picture" context.
I hesitated to show this example, as it's really a very quick and small trap. And a difficult entry based on a very minor lower-timeframe stall.
But sometimes that is all the market offers. And given the potential for a trap at the open to provide a nice momentum drive, it's one that I had to take.
Part of me wonders whether I'd take this entry anyway even if there had not been a trap. I had a bullish bias due to the pre-session action holding above the prior day's range. Plus the fact that I expected some range expansion on the open following a narrow range holiday session.
We'll never know for sure. Perhaps I would have taken it. I suspect not though. The lower timeframe trigger pattern was a little "smaller" and less defined than I would perhaps have liked. It really was the presence of the trap, albeit small, that provided the confidence to go for it.
For me… a trap entry prior to or right on the open is something that will often have me taking the quick early trade. Without that, I prefer to sit and wait. Let any opening congestion clear itself. Let the structure develop. And then trade once I have some clarity regarding the bias and market conditions.