Financial history doesn't repeat itself, but it often rhymes. You can't be stupid enough to trade off anything I say.... I'm lucky they let me out of the straight-jacket long enough to trade.

J. P. Morgan

"Sell down to your sleeping point"

Wednesday, May 20, 2009

the day Play by Play

So... we bled off the momentum from our 235 point day, had a pause yesterday, and there was more pain for the shorts. But it was a good day to see if the momentum would continue or if we would break down.....
At the usual 10:30-11 morning momentum pivot time, volume picked up and we started selling....
Bla bla bla... the downside momentum ended, and we caught a bounce.

Tony asked if what I posted in red was a Flag.... Marked in green is where I would have like to have seen a Nice 2 Swing small bear flag testing the upper green line twice and breaking down... It ...SORT of played that way... In a way it kind of was a move that looked like it wanted to be shot.
So..... here it is... suddenly a ton of tight stops got hit, and we broke down... and we got a second swing.... I did play this... and it scared the shit out of me with all that volume going both ways. I figured we would get a Real Bear flag out of it.... or something like a bear flag to play....

but the bias was for downside, based on the break down... so the question was... where to start a new position.. So... I set up 3 sets of swing lines. Lt Blue, Dark Blue, and Green. I was hoping we would hit Green or Dark blue, then I could hit it... but no luck... things were weaker than that....

So.... we want the weaker pattern than the Flag... so we look for a Pennant, and Right .... it's a 2 swing pattern.... and the setup was perfect... and we had 2 possible points and they both setup at the same time... and We just sold into it.... End of the day, it hit it's target, and I exited Most of the position, leaving some on the table to see what the futures bring. Very Happy, 3 trades, 2 paid, one went neutral.

Though I talked about a flag setup... it blew up before I could play it.

4 comments:

Tony said...

Nice. Thanks for the clarification. can we call that sell off Wave 3 and a Wave 4 started at the close?

I'm at a complete loss as to where to go from here. I'm almost completely closed out now on trading account. All the shorts were covered near the close.

Best trading day in the last 7 days.

The Mop said...
This comment has been removed by a blog administrator.
Eric said...

Well... we are range bound 88 to 93..

the negative sign is that we had a high volume sell off...

so negative Bias.

But... Either we sell off aggressively toward 88, and the "Failed move" means a Fast move.... or we look for the Pennant... the pennant will have a continued down-move, bounce back up to the trend-line..

but ... down futures should bounce... Short term oversold...

also this down-move has a nice ABC look to it....

but to say it.... this down-move feels like it falls short.

but we will see in the morning...

the easy thing to say is Play it on a breakdown below 88, or short at 95.... other than that we are "Playing between the lines"

For fuck's sake

Eric said...

"for fucks sake" was because I posted using the other account.

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