One of the primary challenges traders deal with is knowing when the markets are volatile enough to enter intraday and swing trades vs. when to avoid trading. Obvious breakouts often occur too late in the trading day to generate useful buy and sell signals; what traders need are early indications of the likely intraday trend and a way to identify the most favorable conditions for follow-through.

Fortunately, pre-market trading activity and breakouts of the previous day’s high or low that occur in the broader market can give an early indication of when, and in which direction, to trade during a trading session. The best trading opportunities occur on days the market is moving outside the prior day’s range and in the direction of the pre-market trend.