Weekly opening range breakout involves trading off the Monday ‘opening’ price by a predefined volatility measure. At Forex Trading-Pips we base our volatility measure on the previous weeks range as measured from the previous weeks high to low value.
We have marked Monday’s ‘opening,’ as recorded at 6AM London time, on the Euro currency chart below using a vertical yellow line. Our entry price (horizontal blue line) is calculated as Monday’s opening price +/- 30% of last weeks range. In this case we triggered Long entry at 1.2711. Our stop loss (horizontal red line) is Monday’s opening price – 10% of last weeks range, 1.2610. Our total risk on the trade is 101 pips, our current open profit is 200 pips. We plan to exit the trade on the Monday morning London ‘open’, 6 AM UK time.
Weekly opening range breakout strategies can catch some nice moves when the market continues to trend all week. Other times, when the market is choppy, our losses are contained to 40% of the previous weeks volatility, equal to a small percentage of risk on our account (typically <1%) .
Forex Trading Euro currency
