Jun 20, 2007

BIDU won the battle...

I won the war.
 
I initially entered short BIDU off the 7th bar on the :15 chart. I immediately didn't like the spread action, but I wasn't going to get out and lose money without a good reason. So, I waited for a good reason to lose money and was stopped out on the 12th bar. Great thinking. However, I still wanted to short BIDU since price action never really rallied above the 50% intraday fib. level.
 
This is how I won the war:

  • Placed fib. levels from 1st bar low to 1st bar high (very bearish 1st bar)
  • After 10am, price bounced off the 61.8 level a few times, signaling heavy resistance
  • I waited for price to break down below the 38% level on heavy volume which it did during the 12:50 candle
  • Entered (very nervously) on a break of this candle's low and it looked like price might bounce back up again
  • Price dropped hard and I got out without pushing my luck during the 1:20 candle (161.8 fib. level)


I don't consider this a revenge trade as I just waited for a better entry with higher volume behind it. From here on out, I'm creating a new rule for myself. I will not enter a candle unless volume is twice the amount as the previous candle.
 
EDIT: Gonna rethink the volume rule... 2x might be too high.

6 comments:

JerryC said...

I have to learn how to re-enter with guts.

Another great trade to learn.

Thanks.

rudy said...

Yea, I know what you mean. I spent over $10,000 to horn my skills, and I did hate to give away any of "their trading secrets". lol.

The truth is, what I know now is part of me. I synthesize their ideas and made it my own. So I think it would be fair to say that my method is now uniquely mine.

Besides, as one turtle member said "you can print the exact turtle trading system in the wall street journal, but no one will follow it". It is human nature.

However I respect your thinking. Rudy

Anonymous said...

I traded SPWR on 15 minutes chart, entry in 8th bar, on the break on 7th bar's high, and exit 2 bars later when it's stalling at 60.00 level.. later on it breaks 60 and flying another 2$ away, but I have to go to work and cannot monitor my trade.

-DT

Anonymous said...

BTW OONR7, could you please explain more about your 2x volume is too high? Is it for the scanner to pick up the stocks for your watch list or it's a break out to trigger the entry point?

-DT

Jamie said...

Sweet!

So revenge trades work for you ;)

OONR7 said...

@jerryc: thank you, it's not easy re-entering a trade you just lost money in.

@rudy: there are no trading secrets here as the site - and my trades - are pretty much an open book. If you read my bullet points for each trade and look at the charts you can really see what I'm talking about. However, I will post something on my trading style in the near future.

@dt: nice trade with SPWR. Too bad you didn't have time to see it through as it made a huge upward move. A more conservative entry would've been on the 9th bar - a good X trade. And there was great volume on that bar as well (more than 1.25X the previous bar).
Which brings me to your question about volume. I mean the volume on the entry bar. And, I've reduced it to 1.25X instead of 2X. To me, increased volume on an entry bar that is breaking through or setting up over a certain fib. level has a high probability of success than on reduced volume or equal volume on the previous bar. There are exceptions... such as nr7 bars.

@jamie... hey, it worked today :)