Opening range breakout, as rules you can test
An opening range breakout marks the high and low of the first minutes after the US cash open, then trades a break of one side with the stop on the other side or the range midpoint. It's simple to define and easy to test, and it fails often in choppy, range-bound sessions. Treat it as a hypothesis to test, not a system.
The hypothesis
The first minutes after the 9:30 AM New York cash open set a range. A decisive break of that range sometimes starts the session's directional move. Sometimes it doesn't, and price returns into the range. The method only has an edge if the first case pays more than the second costs.
One version written as rules
| Part | Rule |
|---|---|
| Market | MES or MNQ, regular session |
| Range | high and low from 9:30 to 9:45 AM ET |
| Entry | stop order one tick beyond the range high (long) or low (short), first break only |
| Stop | range midpoint |
| Exit | 2 × the risk, or flat at 11:30 AM ET, whichever first |
| Skip | if the range is wider than your daily stop allows at one contract |
These numbers are a starting point for testing, not a recommendation.
How it fails
- Chop: price breaks one side, reverses, breaks the other. Two losses in one morning.
- Wide ranges: on news days the range can be wider than your daily loss limit allows. The skip rule exists for that.
- Slippage at the break: stop entries fill in a fast market and can slip, which shrinks a 2:1 target.
Testing it under eval rules
Collect at least a few dozen sessions. For each, record whether the trade triggered, the result with costs, and whether the day would have breached the account's daily loss limit. Then play the whole list through the eval's trailing drawdown. A method with a positive average can still put two losing mornings back to back on a floor that has just moved up.
Practice before paying
Run it in the simulator on the exact account you'd buy, with the size the position size calculator gives you, for at least a few weeks of sessions.
Blow it here, not on a paid eval
Run the same rules on your own trades in the simulator. Free, no card, and a blown account costs you nothing but pride.
Start practicing