Opening Range Breakouts – $GBPUSD $EURUSD Tanked today

Opening range breakouts sometimes can catch some very strong follow through. In Forex, one of the most important periods is the London open, as it can often set the tone for the rest of the trading session including a follow through into NY Session.

Today’s price action showed an opening range near the day highs on EURUSD and GBPUSD, with both pairs printing opening ranges between 7:30 AM UK time and 7:59 AM UK Time of under 30-pips.

Chart below shows both GBPUSD and EURUSD on 15m charts with an opening range and some extension targets.

The breakouts can take time to get going

  • In the case of GBPUSD, the break gathered downside momentum more quickly than EURUSD today, and then the GBPUSD got strong follow through with a bearish reaction to some dovish MPC minutes (released at 9:30AM UK Time).
22-06-2011_11-12-53_orb_gbpusd

The breakouts can be powerful on newsflow days

  • The Opening Range Breakouts can produce some big follow through on days with heavy newsflow. With the London session on Tuesdays-Fridays featuring data releases affecting GBPUSD and EURUSD, these can be sessions where the breakouts either see powerful follow through or powerful reversals.Either way, the support/resistance zone created by the opening range can help you see areas where price will either be contained by S&R, or areas where price is likely to stage a breakout.

Sometimes inside bars show up on these breaks

  • The chart in this post shows that GBPUSD printed an inside bar on its impulsive down move (none for EURUSD). The inside bar patterns can sometimes offer attractive risk/reward when a break gathers steam.
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