| DEC 1988
Opening Range Breakout Part 3 by Toby Crabel
Opening Range Breakout Part 3 by Toby Crabel In the opening range breakout technique, the heralds of an upcoming trend day are often inside days, narrow range days and hook days (see Stocks & Commodities, September and October 1988). I also have run across a new concept that categorizes price action and generally produces trending activity the next day. I call it Doji Lines. Doji is a Japanese word describing a comparison between the open and the close of the daily session. It is described in a book, The Japanese Chart of Charts by Seiki Shimizu. A Doji Line is a day that shows a very small difference between the open and closing prices (Figure 1). ""Very small"" is a relative term but, through observation, I have attached quantities to this open-to-close difference to meet the need for definition. In Figure 1, the left-hand bar is what a Doji Line looks like on a vertical bar chart; the right-hand bar is how it is displayed by Shimizu. In this case, the close was less than the open, so the open-to-close range is displayed in black. If the close had been above the open, the box would have been clear. Figure 2 displays the Doji with a hypothetically defined narrow range day at point ""a."" We'll define narrow range day in a moment, but for now suffice it to say that the action following point ""a"" represents a trend day.
by Toby Crabel
Technical Analysis of STOCKS & COMMODITIES
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