I have traded for some time but still find buy to open orders confusing. I understand they start new positions but I’m not clear on the right times to use them.
I worry I might miss good chances due to my lack of understanding. I have made mistakes by entering trades too early.
What scenarios are best for these orders?
Buy to open works best when you spot a clear setup and want to start a new position. Use it when you see strong momentum, breakouts from key levels, or price bouncing off major support.
Timing beats order type every time. Wait for confirmation before entering - don’t jump in just because you think something might happen. I wait until at least two indicators align, like volume spiking with price action.
This video breaks down the basics really well:
Patience is key. Better to miss trades than keep entering too early and losing money.
Best entries happen right after price smashes through major support or resistance. You’ll see clear momentum once these levels break.
Waiting for confirmation can save from jumping in too early. Price often retests the broken level before continuing the move.
High volume during breakouts makes these signals much more reliable.
Use buy to open orders when:
• Market gaps above resistance at open
• Price breaks above key moving averages
• Volume spikes back up the move
Skip them during choppy, sideways action. Success rates jump 70% higher in trending markets.
Start using them after you see a strong trend change or a reversal.
My biggest mistake was trading during lunch - markets barely move and I lost $400 in three days doing this.
Now I only open positions when there’s real momentum after major news or in the first trading hour.
Economic announcements are money. Yesterday’s unemployment data gave me a perfect entry that hit 85%.