Every trader knows the chaos of the morning open. Prices surge, emotions fly, and within minutes, your gut is screaming louder than your strategy. For most people, that chaos leads to hesitation. They wait for confirmation, a second signal, or that extra bit of safety. By the time they act, the opportunity is gone—or worse, the trap has already sprung.
But there’s a simple, intuitive method that flips this problem upside down. It’s about learning to read the price vs. average price line in the opening minutes—and acting before the herd catches on.
The Setup: Price Meets the Average Line
Look at the intraday candlestick (the white line) and the moving average (the yellow line). When the market opens strong and prices shoot upward, the moving average naturally trends up with it.
Now here’s the trick:
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Wait for the intraday price to fall back toward the moving average.
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Enter a long position the moment price snaps back near that line.
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Keep your stop-loss at the opening price—tight, clear, no second-guessing.
It’s straightforward, it’s clean, and it works because you’re trading right at the moment when sentiment is still red hot, but the crowd hasn’t piled in yet.
The Exception You Must Respect
Like everything in trading, this isn’t foolproof. Sometimes, a big player dumps a heavy order right at the open, cashing out while retail traders are still blinded by the surge. You’ll see this as:
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Price explodes upward on the open.
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A long order gets closed (profit-taking by big money).
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Price shoots up again, then collapses.
That’s not your standard play—that’s an exit by someone with size. When you spot this, don’t trust the bullish energy. It’s just sentiment, not conviction.
Why This Works (And Why It Feels Wrong)
Most traders wait for the second confirmation. They think: “If price comes back up again, then I’ll enter.” But by then, the easy money’s gone.
The first retracement is where the edge lives—it’s uncomfortable, it feels rushed, and it goes against the “safe” play. But the market doesn’t reward comfort; it rewards decisiveness.
By the second retracement, the move is already showing cracks. By the third? That’s no longer opportunity—it’s a warning sign. If the market has to give you three chances, the order is weak. Get out.
Exit Strategy: Don’t Overstay the Party
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First retracement = entry. That’s where your profit window opens.
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Second retracement = caution. Take your gains and protect your chips.
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Third retracement = exit. No negotiation. If you’re still holding, you’re not trading—you’re gambling.
Final Thought
Short-term trading isn’t about catching every move. It’s about recognizing the one moment when momentum, psychology, and structure line up—and pouncing before everyone else does.
The market doesn’t owe you multiple chances. Often, it only gives you one. The difference between winners and losers? Winners take it.
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