The Open: the idea and the backtest
When the market breaks out of its normal range after the open, it has tended to keep going. The Open trades that move and is flat by the close. The idea, and its backtest.
Most days, the index wanders inside a normal range around its open. Some days it breaks out of that range, and when it does, it has tended to keep going into the close. The Open waits for that break, trades in its direction, gets out if the move fades, and is always flat before the close. Nothing is held overnight.
Where it comes from
The idea comes from published research on intraday momentum in index futures. The "normal range" is measured from the market's own recent days, so it widens when markets are busy and narrows when they're quiet. We coded it and tested it on Nasdaq futures, and the published version passed a test we registered in advance, on data it hadn't seen, before we trusted it.
The backtest
What the evidence says
| Every year since 2019 | Positive, 8 of 8 |
|---|---|
| Net per NQ contract, 2019 to 2026, after costs | About $203,000 |
| Trades, 2019 to 2026 | About 1,340, on about half of all sessions |
| Profit factor (total won divided by total lost) | 1.3 |
| Held overnight | Never |
Per NQ contract at $20 a point, with $2.50 commission and 2 ticks of slippage on each side, on continuous Nasdaq-100 futures intraday bars. Rounded. 2026 runs to late October.
Hypothetical results1, not actual trading. The full statement is at the end of this page.
What to take from it
The Open makes its money in small steps on many days, not in a few big ones. That makes it the steady leg of the three rules. It also means it needs the market to move: on quiet, choppy days it gives a little back, which is why it runs next to The Close instead of on its own. See Three rules, one curve.
The calls go to daily read members as they happen. The course starts with two free lessons: the idea and the research behind it.
Education only. Nothing here is advice about your account.