1989issue C071-3
The bull hook as a next-session opening-range breakout filter
A bull hook is a one-bar eligibility switch, not a trade signal. It only decides which stretch stop of the next session opening-range breakout may fire. An editorial veto stack then uses the following open, a reclaim of the hook close, and any nearby buying extreme.
- A bull hook opens above the prior session high, closes below the prior session close, and prints a narrower range. That bar does not enter a position.
- The next session still uses an opening-range breakout: stretch-offset stops beyond both sides of the opening range, with the first fill becoming the position.
- Editorial reading stacks the next open, a reclaim of the hook close, and any nearby market-profile buying extreme as same-session vetoes on which stretch stop may fire.
- A prompt move from the open in the hook's upside bias is treated as preferred follow-through. A move against that bias is treated as a caution, and the bull hook is described as less consistent than the bear hook.
What a bull hook records
A bull hook session is defined as an open above the prior session high, a close below the prior session close, and a narrowing range. That session is a condition bar. It does not fill a position.
How the next opening-range breakout is built
The opening range is the price span printed in the first 30 seconds to five minutes of a session. Stretch is the 10-session average of the distance from each open to the nearer session extreme. It is the offset used for breakout stops.
The orthodox opening-range breakout places a buy stop one stretch above the opening-range high and a sell stop one stretch below the opening-range low. The first stop filled becomes the position.
Next-session opening-range breakout tests after a bull hook evaluated both buy and sell stops at stretch distances from the open. Those tests included cases where a nearer offset was treated as a buy location and a farther offset as a sell-stop location.
Follow-through after the hook
After a bull or bear hook, a prompt move from the open in the pattern's directional bias is treated as the preferred follow-through. A move against that bias is treated as a caution.
A lower open the day after a bull hook is presented as adding room if price fills the gap toward the hook session's close. A later trade of that close is treated as favoring upside continuation.
An uptrend, a lower open after a bull hook, and early buying are presented as a joint condition for a next-session opening-range breakout, especially when an important support angle is nearby.
A nearby buying extreme
When market profile reports are used, a large buying extreme near a prior open, appearing as a spike or spring on a regular intraday chart, is treated as a support location for assessing the setup.
Bias after a bull hook
The bull hook is characterized as less consistent than the bear hook, the inverse hook used as the comparison case. The tests are still described as showing a predictable upside bias after the bull hook.
All readings on this track · 20 readings
- 1987Intraday Value Area construction from TPO counts
- 1987Constructing session market profiles from half-hour auctions
- 1988Volume value area versus time-print filters
- 1988Auction control from a price, volume, and time ledger
- 1988Constructing intraday trade-facilitation percentile tables
- 1988Constructing session decisions from auction age and volume
- 1989Range extension after the opening auction
- 1989Constructing value maps from auction volume overlays
- 1989The bull hook as a next-session opening-range breakout filter
- 1990Incomplete volume-at-price samples and auction reads
- 1990Constructing overlay profiles to map auction value
- 1990Constructing daily overlay profiles for auction brackets and breaks
- 1990Volume-confirmed facilitation as an execution gate for half-hour breakouts
- 1992Volume-box construction with named spreadsheet macros
- 1993Commercial volume caps outside the value area
- 1993Hourly participant volume as a live filter for day trades
- 1999Assembling the daily auction from time-price opportunities
- 2000Who accepted price first in the auction
- 2002Treat the session as an auction: find value, then judge the breakout
- 2002Auction structure, trader constraints, and the opening range