ORB Futures Trading Strategy Lecture

Vocabulary flashcards covering key terms, patterns, and rules from the lecture on using Opening Range Breakout (ORB) strategies, risk management, and relative strength for futures scalping.

Opening Range Breakout (ORB)

The high-low range of the first 15-minute candle after a market open, used as a key reference zone for trades.

Midline of ORB

The halfway price between the ORB high and low; often acts as a minor liquidity level and first profit-taking target.

One-Two Punch

A trade entry pattern where price breaks ORB, immediately retests it, then rejects; entry is taken on the retest with risk placed beyond the structure.

Three-Bar Play (One-Two-Three)

A sequence of a breakout candle, a resting inside bar, and a continuation candle, used for momentum entries at ORB edges.

Break-and-Retest

A price movement that breaks a level, pulls back to it, fails to reclaim, and resumes in the breakout direction, confirming entry.

R Multiple

A way to express risk-to-reward as ‘R’; e.g., risking 1R to make 3R is a 3:1 risk/reward trade.

Risk-to-Reward Ratio

The proportion between potential loss (risk) and potential gain (reward) in a trade; higher ratios allow lower win rates.

Relative Strength

A comparison showing which index or asset is moving more positively (or less negatively) than another at the same time.

Confluence

The alignment of multiple signals (e.g., ORB level + relative strength) that increases trade conviction.

NQ

Ticker for Nasdaq-100 futures; more volatile and faster-moving than ES, with $20 per tick value.

ES

Ticker for S&P 500 futures; moves more slowly than NQ and has a $12.50 per tick value.

SPX

Cash index of the S&P 500, watched for guidance while trading NQ futures.

Liquidity Zone

A price area (often ORB edges or midline) where many orders sit, causing repeated tests and rejections.

50-Yard Line (RSI)

The 50 level on the Relative Strength Index; above it implies bullish momentum, below it bearish.

Momentum Oscillator

An indicator (e.g., RSI) that measures speed of price changes rather than direction alone.

Break of Structure

When price closes beyond the prior candle’s high or low, signaling a potential trend shift and stop-loss point.

Runner

A remaining portion of a position left open after partial profits, intended to capture extended moves.

Trim / Take-Profit

Partial or full closing of a position at predefined profit targets, commonly the ORB midline or opposite edge.

Stop-Loss at Breakeven

Moving the protective stop to the entry price after profit develops, eliminating downside risk.

Chop Day

A session characterized by sideways, range-bound price action, often favoring premium-selling or ORB scalps.

Base Hit

A small, quick profit target (e.g., 10-15 NQ points) preferred in scalp trading.

One-and-Done Rule

Trading plan rule: if the first trade is green, stop for the day to lock gains and protect prop-firm metrics.

Two Reds Rule

Trading plan rule: if two consecutive losing trades occur, stop trading for the day.

Prop Firm

A company that funds traders with firm capital once they meet profit and risk criteria in evaluation accounts.

Inside Bar

A candle whose high and low sit entirely within the prior candle’s range, often the ‘rest’ bar in a three-bar play.

Scalping

A trading style aiming for rapid, small profits, frequently using 1- or 2-minute charts in futures.

15-Minute Chart

The mandatory timeframe for plotting ORB high, low, and midline according to the lecture.

Trim Box

A pre-drawn area on the chart indicating the first zone to scale out profits, usually the ORB midline.

Runner’s Hold Zone

Price area past initial targets where remaining contracts are allowed to ride while stop is at breakeven.

Choppy Liquidity Play

An ORB strategy that relies solely on favorable risk-to-reward at repeatedly tested ORB edges without extra indicators.