(1) Recognition of potential for unfavourable conditions
The following post was shared by social media pre-session on Monday:
Expanding a little on that image:
And adding further to this potential for unfavourable conditions:
In the absence of unexpected news that provides a clear directional bias, I don’t imagine many longer-term traders keen to take positions prior to these events.
(2) The plan – TRADE WITH CAUTION
Pause. Recognise there is no hurry. There is no urgency to trade.
I can sit back and let the opening structure develop. And then make a decision as to whether or not this is a market worth trading.
And yes, I like what I see.
While the indecision has continued into the open with moves higher, lower and now higher again, there is some nice structure to play off.
(3) Trade off the opening structure
Allowing structure to form first ensures that much of the opening uncertainty will be resolved. You now have clear structure in place. And a clear and obvious plan.
References: BOF/BPB Setups
(4) If opportunity sets up right, TAKE IT
Your aim is to trade on your terms. Not the markets terms. Just because the market opens at 9:30am (or whenever yours opens) it does not mean you have to trade from that time.
If you expect potentially unfavourable conditions, then it’s ok to delay the start of your session.
Or if the structure is unclear and you cannot sense any directional bias leading into the market open, then again it’s ok to delay the start of your session.
Let the opening structure form first.
And THEN trade. Once the structure has formed. And the plan becomes clear and obvious.
Don’t make your trading any harder than it needs to be.
Happy trading,
Lance Beggs
PS. You may also be interested in these prior examples: