The Opening Drive trading system is a popular day trading strategy that is based on the first 30 minutes of trading activity in the market. The idea behind the strategy is that the first 30 minutes of trading activity can provide important clues about the direction of the market for the rest of the day. In this article, we will discuss the Opening Drive trading system and provide an example to illustrate how it works.
What is the Opening Drive Trading System?
The Opening Drive trading system is a day trading strategy that is based on the first 30 minutes of trading activity in the market. The system is based on the premise that the first 30 minutes of trading can provide important clues about the direction of the market for the rest of the day.
The system is relatively simple and involves the following steps:
Step 1: Identify the opening range
The opening range is defined as the high and low of the first 30 minutes of trading activity.
Step 2: Identify the direction of the market
If the price breaks above the opening range, it is considered a bullish signal. If the price breaks below the opening range, it is considered a bearish signal.
Step 3: Enter the trade
If the price breaks above the opening range, enter a long trade. If the price breaks below the opening range, enter a short trade.
Step 4: Set stop loss and profit target
Set a stop loss and profit target for the trade.
Step 5: Monitor the trade
Monitor the trade and adjust the stop loss and profit target as needed.
Example of the Opening Drive Trading System
Let’s look at an example of how the Opening Drive trading system works. In this example, we will use a stock as an example, but the system can be applied to any market.
- Identify the opening range
The opening range is defined as the high and low of the first 30 minutes of trading activity. In this example, let’s say that the opening range for a stock is $50 to $55.
- Identify the direction of the market
If the price breaks above the opening range of $55, it is considered a bullish signal. If the price breaks below the opening range of $50, it is considered a bearish signal.
- Enter the trade
If the price breaks above the opening range of $55, enter a long trade. If the price breaks below the opening range of $50, enter a short trade.
- Set stop loss and profit target
Set a stop loss and profit target for the trade. For example, set the stop loss at $54 and the profit target at $60.
- Monitor the trade
Monitor the trade and adjust the stop loss and profit target as needed. If the price moves in the desired direction, adjust the stop loss and profit target accordingly.
Conclusion
The Opening Drive trading system is a popular day trading strategy that is based on the first 30 minutes of trading activity in the market. The system is relatively simple and involves identifying the opening range, identifying the direction of the market, entering the trade, setting a stop loss and profit target, and monitoring the trade. As with any trading system, it is important to conduct thorough research and testing before implementing it in a live trading environment.
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