HAR - Long

What a difference a couple of days make. In hindsight, going 0 for 5 Tuesday was probably a good thing. It helped me re-focus on volume and remind me how important it is to my system. Not saying I won't make mistakes in the future, but I like how I was able to spot a divergence, make changes and see positive results. I traded HAR and ACN today. I was shaken out of ACN (5-min) at the ORH for a gain before it proceeded to jump up and through the ORH and tag the intraday fib. ext. With both HAR and ACN, my entries were made off of inverted hammers. Jamie uses these a lot and it makes sense. It's a bar that demonstrates the bears tried to take over but the bulls were still in charge. So, if the high is broken on the next bar it's kinda like the bulls telling the bears to piss off. Or something like that :)
Here's the HAR trade:

• Nice, strong first bar
• Price retraced down to the 61.8% fib. level (gee, so weird how that always happens :)
• I really wanted to enter off a break of the 10:50 bar high as it was an inside nr7 hammer with low volume, but it wasn't above the 38.2% fib. level so I waited
• Entered long on a break of the 11am bar high (inverted hammer) on increased volume
• Speaking of volume, the spike on the 10:40 bar showed me the bulls were interested and the increased volume on my entry bar basically confirmed it (at least that's how I interpreted it)
• Exited at the beginning of the 1pm bar as I didn't want to risk giving back my gains (a doji formed on the 15-min chart too). If I stayed in the position, my new stop would've been on a break of the 12:50 bar low but I didn't want to risk losing .30 on a hunch... plus, I had to go out and get dinner

SGY - Long

SGY was pretty much picture perfect the way it retraced down to the 38% fib. level and bounced off the 5ema. My entry was a nice narrow bar with volume. Don't think I need to break down this trade... look at the chart. I exited half on a break of the 12:20 bar low and the rest on a break of the 2pm bar low.

GB - Short

As Eyal pointed, it was pretty choppy today. I actually tried some new things to get my watchlist smaller - yet still loaded with nice stocks. Yesterday was a bit of an eye-opener as it reminder me that I was getting away from what's most important in gap stocks... big volume. So, I'm re-shifting my focus to try to eliminate low volume plays and I hope this will allow me to reduce my list quicker and focus on the high-volume gappers. I don't feel like I've missed high-volume plays, I just feel like I get lulled into chart setups and almost forget about the 'pump' behind the price action. Anyway, I'm rambling... all behind the scenes stuff. So, I missed a great play off of Jamie's watchlist today in GME. I was watching, nah - staring, the second bar on the 15-min chart but ended up staying out of the trade. The 10:10 bar on the 10-min chart looked good and so did the 10:20 bar on the 5-min chart. I was able to catch a nice short off of GB. Here's the trade (15-min):

• After a strong first bar on a big gap down, price moved down through the fib. levels in a nice, orderly fashion
• As it approached the 61.8 level, I notced a NR7 down bar on the 8th bar, but there was no volume behind it
• The 9th bar produced another NR7 with increased volume and I entered on a break of the candle's low
• I flipped to the daily chart to see what the potential run could be and noticed a major pivot (support) area at 27.40 so I was a bit nervous price would bounce at this area
• I exited during the 12:45 bar after 'feeling' like 27 was offering a lot of support
• Not a huge gain, but a nice trade after an 0 for 5 day like yesterday

Volume quiz

When dealing with gappers (such as the ones below), what kind of volume would you rather be dealing with?

1) Set A
2) Set B

Set A

Set B


If you correctly answered set A, you probably didn't lose more than 3R today. Moral of the story... when trading gappers, look for candidates with unusually high volume. That's the beauty of gappers - built in momentum. Duh.

Set A: FMCN, LOW
Set B: KSS, M

0 for 5

Yeah, count 'em... all 5 of my trades today were for losses. My batting average today resembles A-Rod's come playoff time. Total loss: -3.25R. I haven't lost this much or not have a single trade work for me in a very long time. The best advice to myself is this... tomorrow's another day. I stuck to my rules, obeyed my stops and stayed disciplined. That is most certainly a good thing.

Here are the stocks and entries:

M: short, 5-min, 11:20 bar low
KSS: short, 10-min, 11:30 bar low
URBN: short, 10-min, 10:50 bar low
PCAR: short, 5-min, 10:30 bar low
PTR: short, 5-min, 10:25 bar low

Ernie's foul mouth

I haven't posted a video in a while and since I made no trades today I figured I'd lighten up everyone's day with a little Bert and Ernie humor.

FYI: This is NSFW and not for anyone who doesn't like foul language (keep the kids away). This also is not for anyone who grew up with Sesame Street and wants to keep their wholesome image firmly intact.

EDIT: Don't want to offend anyone with the language.. so I took it down. But if you really want to see it - click here.

Rise or Fall revealed

I like to think of my daytrading system/style as a work of art. It's never really 'finished' and there's always room for improvement. With this being said... I have really enjoyed adding intraday pivot points to my charts recently as they're another good sign of support and resistance. I pretty much use the 38.2 and 61.8% levels as support and resistance and now when I see a pivot point forming in these areas I pay special attention. So, bottomline... you'll be seeing pivot point lines in my charts from now on. That brings me this week's Rise or Fall trade (or non-trade). I came across NXY in my weekly review and thought to myself "Why the f*%$ did I not enter this trade????". I might've been in other trades at the time and managing those, but this was a gem that slipped by (because it was in my watchlist that day). So on the chart I posted I intentionally didn't add the pivot point lines so you can see that - once added - it can really change how I interpret a potential trade.
 
Okay... the trade:

• On the 10-min chart below you'll notice price closed right on the S1 line
• The entry bar was also an inside, NRB with a volume spike from the previous bar. This tells me that this is a potential breakout area
• Entry bar was also smack up against the 5ema and, frankly, this was either going to shoot up or down
• I also really like when the pivot line is very close to my normal entry area (in this case, the 61.8% fib. level)
• Price dropped very quickly after the entry bar and the primary target price was the fib. ext (with an eye on S2)
• I probably would've taken a partial on a break of the hammer that formed at the 11:50 bar and would have definitely been out once price tagged S2

 
To add pivot point lines in Quotetracker, just right click on the chart, click on 'Select indicator' and then scroll down the top left menu bar till you get to Pivot Points and add.

Rise or Fall

Take a look at the last candle on the 10-min chart below and let me know if you would go long, short or stay put... and why?
 
10-min

Daily

Eh....

Not a fantastic day for me. Was pretty active and ended up digging myself out of a hole with BLUD, but I had to even get out of that before I thought I was going to have to. My typical type of trades weren't really workin' today but I did see a nice inside NR bar (2nd bar) setup in SNCR (15-min) right above R2. I actually had this trade up on my order screen but hesitated because I thought the 5ema was too far away. Kinda kicked myself when it proceeded to drop 3 points.

Enjoy your weekend. I may throw up another Rise or Fall tomorrow.
 

Hybrid trade - CREE

Going into today's trading, I knew I had to be out of all positions by around 11am or so as I had some things to do. So, I was hoping for a nice quick trade and that's what I got with CREE. I call this a hybrid trade because it incorporates my system with King Jamie's pivot points. Here's the chart:

• The first thing that spotted my eye was the 2nd bar on the 15-min chart (inside bar) which formed right above R1
• Looking at the 5-min chart, I saw price quickly dip below the 61.8% level, but never close below the 50% level
• I mentioned in the comments yesterday that I view the 5, 10 and 15-min charts at the same time. So, on the 10-min chart, I could see a nice hammer forming above R1 at the 10am bar
• Now, going back to the 5-min (have I lost you yet??), I entered long on a break of the 10:05 candle high on increased volume
• Price went up almost as soon as my order was filled and approached the fib. ext. quickly. There was some consolidation at the fib. ext. and I was ready to partial out but it never happened
• Since I had to leave early, I figured the nice round number of $34 would be a good place to exit (which was .07 below R2)
• It worked out great, even though I missed a little bit more of a push upwards

Up and down

Traded JOYG long (10:50 bar, 5-min), FCX long (11:15 bar, 5-min) and then FCX short (11:15 bar, 15-min).
 
The FCX short helped saved the day. I actually would've been somewhat pleased with today's results if I hadn't bumbled my exits on JOYG and FCX long. But in the end, I took a .67R loss for all my hard work.
 
My FCX short pretty much had King Jamie's name all over it as it was a shooting star off of R2 (intraday pivot point resistance) on increased volume. I took it down to just above R1 and then bailed. I really like when intraday pivot areas line up with my 38.2% or 61.8% fib. levels.
 
Here's the chart:

SIGM - Long

Seems like I'm always out of my morning trades by 2pm the latest... today being no different. So far this week I haven't been twiddling my thumbs at all as my watchlist has been fairly decent and I'm also looking at King Jamie's watchlist for early inside bar moves. I traded SIGM today for a nice gain, here's the chart (10-min):

• Price was basing along the lower third of the opening range leaving some bearish upper tails along the way
• Bars 9-11 really started contracting and printed a couple of inside bars. I was really waiting for price to pierce and close above the 38.2% level
• Entered long on a break of the 11:30 bar high (marabuzo) on increased volume
• Exited all share on break of 1pm candle low (shooting star). I figured the run might be coming to a close and the FED was nearby

CHL - Short; NWL - Long

Mondays have been good to me lately. It's always nice to start the week off on a good note (because you never know what's ahead). I found some solid setups in CHL and NWL. Also, I figure I can skip the whole first line of my analysis, you know 'Placed fibs. from first bar high... blah, blah, blah'. I think most of you guys get it by now. Here are the charts:

CHL - 10-min

• Price dropped initially, then shot back up to just above the 61.8 fib. level (resistance area) and then dropped back down again
• Price consolidated with a couple of NRB at the 38.2% fib. level
• Entered short on break of 11:30 candle low on increased volume
• Exit half my position on break of the doji high (12:10 bar)
• Exited remaining half on break of 12:20 bar high as it looked like a bullish morning star pattern and reversal area (daily chart also showed 68.47 as a pivot area)

NWL - 15-min

• After strong first bar, price consolidated nicely along the 38.2% fib. level
• Entering long on break of 11:15 candle high. Since the close was near the ORH, I was looking for signs of reversal, but there were none
• Exited on a break of the 1:30 candle low. Preceeding candle was WRB and my exit candle was a down, spinning top bar. Those were enough reasons to exit for me
• This was a really nice looking setup
  

WTF - Short

Okay, I didn't trade WTF... but I did have a WTF trade today. Hey, what can I say? Just got tired of sitting on my hands. The trade was IMCL and while the pattern looked nice before entry, the actual entry bar didn't follow a couple of my key rules (volume increase and strong/weak close). But, I saw the entry dangling there... looked at my scarce gappers watchlist and said WTF (do not try that at home). Honestly, I shouldn't have taken this trade because I try to be a very disciplined trader. However, sometimes it's okay to take some calculated risks. The only thing really lacking on this trade for me was the volume as my entry was still a NRB (spinning top). Here's the chart:

• Placed fibs. from first bar low to high
• Price dropped below the 61.8% level then quickly moved back up again (didn't like that)
• Price then moved nicely back down in a nice orderly fashion (notice the half circle, similar to my MVSN trade earlier this week)
• Entered short on a break of the 11am candle low
• Took a partial on a break of the 11:30 candle high (hammer above the 5ema and at the ORL, possible reversal signal)
• Sold the rest on a break of the 12:30 candle high

GM - Long

Another day with not a lot of candidates but GM set up nicely on the 5-min chart Although it did give me some trouble right away. Here's the chart:

• Placed fibs. from first bar low to third bar high
• Price almost retraced 100% before rising again
• Formed a nice base along the 38.2% level (I look for this when a stock has dropped down after the open)
• Entered long on a break of the 10:50 candle high on increased volume (broke above the base)
  
• Next candle after entry was a shooting star and I immediately sold off some shares to limit risk
• Priced retraced and bounced off the 38.2% level and steadily rose until bursting through the ORH
• Sold remaining shares just above the fib. ext. (didn't catch the ride up later)

MVSN - Short

Hey... how about that, a trade which I can post a chart??? Today really wasn't any different than the previous couple days as far as gappers are concerned (not a lot of candidates). However, I did find a great setup on MVSN. Here's the trade:

• Placed fibs. from first bar high to second bar low
• Price rose, tagged the 61.8% level, dropped and consolidated just below the 38.2% level
• Entered short on a break of the 10:50 candle low (notice the half circle before entry) on increased (actually huge) volume
• Price broke down below the ORL but then consolidated again right above the fib. ext. and I decided to pocket my winnings at that point
• I've written a couple of posts recently about the 'craziness' before an entry candle. This trade was very 'sane'. Very little lower tails and a good amount of NRBs before entry.

Time off next year...

I think I may do like some other bloggers and just take off from mid-August to mid-September next year. Trading gappers has been awfully boring lately. Made no trades today as nothing set up for me.
Frankly, I hope I can just make a couple good trades this week... not really looking for much.

Mr. Market... give me something to trade!!!!

New sponsor

Look over to the right... you'll notice I've added a Sponsors section. Under it is a new sponsor (only sponsor)... Financial Web.

If you have some time, take a moment to visit their site... very useful info.

One and done

Took a shot shorting WM but it didn't work out. Watchlist was also very short today.

Bring on tomorrow.

CHL - Short

Not sure if I missed out on some nice setups or not as Prophet's scan decided to take the day off again. So, I was left with my IB scan and was able to find a nice setup in CHL. Here's the trade:

• Placed fibs. from first bar low to 8th bar high
• The 10:10 - 10:30 bars formed what looked like a bearish falling three pattern
• Entered short on a break of the 10:35 candle low on increased volume
• Exited on a break of the 11:35 high after if formed an nr7 with volume. This really did seem like a good place to exit... kind of a dummy exit of sorts. Place the stop at the top of a very bearish candle with the thought that if it gets taken out... a reversal is possible. I was able to pocket some nice change at this point so I didn't mind.

DRYS review

Here are some more pop up charts on 'roids with some thoughts on why I didn't enter DRYS yesterday:

5-min

15-min

No trades

Calling it a day after nothing really looked good for me. Hope you all did well.

OSIS - Short

Today made up for all those other trades I've taken in the previous two weeks that have matched my criteria... but didn't move.
 
Today made up for the trades I passed in the previous two weeks.
 
Today made up for the trades I was in over the last two weeks but didn't manage the exit well.
 
Today... was a good day (9rish).
 
Here's the trade:

• Placed fibs. from first bar high to third bar low
• Price consolidated along the 38.2% fib. level I tried shorting the 10:15 bar low, but it didn't get taken out
• Entered short off a break of the 10:40 bar low (shooting star after an nr7) on increased volume
• Price took a long, steady nose dive (yay) and frankly, I was just looking for an exit that made sense
• Placed my stop at the high of the 12:05 bar (inside nr7 after a long rundown, I was thinking price would shoot back up)

Nothing exciting

I did go long IBN and short TGT to earn a living but nothing fancy enough to post a chart. Hope you all did well. If so, drop a note in the comments section.

Rise or Fall - Revealed

Two words: Damn, Jamie!

Stock: RDC
Entry: Entered short on break of 10:15 candle low
Rationale: As many of you noted, I would have preferred a more narrow entry bar, but the high/low spread was still around 1% of the closing price and that's narrow enough for me. Just like my SAFM trade earlier in the week, I was looking at price to stall, reverse or consolidate at the ORL. It did consolidate before moving down. I exited on a break of the 10:40 candle high (fib. ext.) as it looked like a tweezer bottom pattern. This trade is a great example of the trades I don't want to get away. Part of my goal of increasing the % of trades I enter that match my criteria. Sure, the r:r was not huge, but frankly, I'm ok with around 1R or slightly more return. I figure it like this... if I only enter 1 trade per day and that trade brings me 1R each time, that's 5R per week. Remember, my goal per week is 6.3R. Typically, I can find 2-3 good OONR7-type of trades per day.
I'm not trying to swing for the fences in my trades anymore, I want to enter as many valid trades that present themselves to me and - by doing that - I know I will exceed my weekly goal.

Here's the full view of the chart:

Rise or Fall - 9/01/07

And the next Rise or Fall installment. Take a look at the last candle on the chart and let me know if you would go long, short or stay out based on the information on the chart and the last candle. I will let you know what I did (or didn't do) on Monday. I took the dates out so you all don't cheat!!! :) Of course, you can figure it out on the daily, but you wouldn't do that, right????

5-min

Daily