Really delving into this trend trading genre I thought why not check the intraday range bar charts. With a slight view it seems that an automated system could be created with always in method.
Important considerations for entry and reversal (or exit):
Price bars should close in the direction of the signal, not flat or in the opposite direction. This is a subtle difference. It goes along with the realization that although prices often test levels and appear to be going that direction, on a closing basis they have left no footprint on the market and so momentum has not changed, it has only paused causing smaller traders to stop out in fear of trend reversals.
Results are filtered most effectively by taking an ORB and only trading the breakouts in the same direction. This greatly reduces the amount of trades but it seems to really get the big boys trading--which is where the big moves come in. We should never forget that.
Things are even more robust if you do not take the first breakout of the day but wait for the second pop outside the ORB.
Another minor note to be aware of. If the second breakout fails to realize any gains, it's probably best to start looking for trades dipping back into the ORB. This will probably result in a winner 2-3 times bigger than the two failures. See below: