I do love a strong gap opening. So let’s begin Friday 31st July 2020 with NQ gapping higher.
We’ll start with the 30 minute chart (RTH session data only so that we see the gap).
Let’s drop slightly to the 15 minute chart and include some overnight data as well.
So let’s prepare for the open now on the 1 minute trading timeframe.
For those trading the YTC Price Action Trader methodology:
Note that from the opening candle we would be playing the First Principle.
The trade is a PB setup. Yes, it’s quick in that the pullback is really small, but it’s still a pullback. This is an important thing to realise – setups will vary depending upon context and market conditions. Had the break of the 1 min candle pushed higher, I’d be waiting for a more “normal looking” pullback structure to form. But allowing for context – a strong bearish opening drive – we need to accept that sometimes this is all the pullback we will be offered. ALWAYS CONSIDER CONTEXT. If you want to classify subsets of setups, you could perhaps call this an Opening Drive Trap entry. But for me it’s still a PB.
The entry trigger was as per the lower image on Figure 4.65 (volume 3, chapter 4, page 89)
If you miss the early entry into an opening momentum drive, or are not even offered an early entry, then you may have no choice but to let it go. That’s fine. It wasn’t yours to catch.
But there might also be opportunity for a late entry, on a trap as price breaks a TTF candle against the direction of momentum, only to rapidly reject this break and resume the momentum drive.
Focus! And be ready for them. They can come quickly.