Opening-range brackets, a two-bar trend filter, and bounded stops

Ranking distances from the open

The historical workflow treats the first print of the session as a measurable reference. From that open it records how far price later travels to the session high and how far it travels to the session low.

Price-change categorization sorts those historical distances into ranked brackets so later stop and re-entry distances come from observed frequencies rather than a single average.

The opening-range construction records one hundred open-to-high and open-to-low distances, ranks each series from smallest to largest, and groups the values into ten brackets of ten observations to form a table of historical move frequencies.

Cycle language beside the table

A four-phase price-cycle framing treats accumulation as a narrow, sideways base, the upmove as expansion above that base, distribution as wide and volatile topping action, and the downmove as a decline toward the next accumulation zone.

Island reversals are presented as a V-shaped exception in which a session is isolated by gaps on both sides and is treated as a candidate for a major or intermediate trend change.

A 10 percent drop in open interest inside ten trading days or fewer, occurring at the low of a sell-off, is described as a condition that often precedes higher prices because participants are leaving the market.

Stops taken from the same brackets

A stop-loss in this workflow is a pre-set exit distance below a bullish open or above a bearish open, chosen from a historical bracket so the loss is bounded before the position is opened.

In the soybean opening-range example, a two-cent stop under a bullish open is treated as about a 50 percent chance of being stopped, a five-cent stop as about a 90 percent chance of surviving, and a seven-cent stop as full coverage of the historical sample.

In the corresponding bearish soybean example, a six-cent stop is treated as about a 90 percent historical survival rate and a nine-cent stop as full coverage of that sample.

A pullback read as re-entry

After an opening rally of nine cents, the same table is used as a certainty that the open was nearer the low, so a later four-cent pullback is framed as a re-entry rather than a failed breakout.

A two-bar label before the trade

The trend filter is a two-bar comparison of consecutive highs, lows, and closes that labels the market bullish or bearish before any opening-range trade is taken.

The two-bar trend filter labels week two bullish, and recommends a Monday open buy, when the rise from week-one low to week-two high exceeds the fall from week-one high to week-two low and week two closes above week one.

The same two-bar comparison can be applied to daily bars, but the source restricts daily use to a two- or three-day sell-off inside a bullish trend or a two- or three-day rally inside a bearish trend.