Sep 18, 2007

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

18 comments:

Jerry said...

You always get good return. Nice man!

BTW, off the topic, during your last trip to USA. Were you force to put your Laptop in X-Ray machine at France or USA?

OONR7 said...

thanks Jerry, those basing patterns are pretty easy to spot. I actually thought I was going to get stopped out on a break of the 12pm bar low, but it came to within 1 cent. Hmmm, I believe I did put it through the X-ray machine. Why, does that mess it up?

Flatwallet said...

nice.

Jamie said...

Traded SIGM as well. Nice B&B setup.

OONR7 said...

yes, it was nice. Did you get in on the 11:30 inverted hammer on the 15-min chart? BIIB was a nice inside bar setup around R1.

Jamie said...

Exactly. Nice trade with BIIB. I missed it. I traded JOYG and CMI. Very early entry on CMI - break of second inside bar on 5 min.

Jamie said...

I mis-articulated that - Break of second bar which was inside

Jerry said...

I heard x-ray won't damage the hard drive like metal detector. But some have different result. So just asking in case.

With your system, I done some research.

1) 5 min worked best. 10 min very good. 15 min fair.
Because you can spot early entry and exit with 5 & 10 min.

2) Stocks that retrace ranging 38.2% - 61.8% success rate is greater.
Becuase for long epecially it may not have much fuel left to go up. For short is another story.

3) If morning hi/low should stayed between 9:30am to the closed of 10:25am/5", 10:20am/10" & 10:15am/15", the success rate is greater.

OONR7 said...

nice going jamie, can't wait to read the analysis. I'm really enjoying your watchlist... some nice candidates over the past 2.5 weeks.

jerry: wow, nice research. I'll try to answer.

1) yes, I'd say that's correct.

2) kinda hard to explain, but I think you got it. I believe a stock that's climbing from below the 61.8% level will more than likely see the 38.2% level as possible resistance. So, I look for a little bit of consolidation at the 38.2% level and then a convincing entry bar above it. In the case of SIGM today, you see that price started basing around the 61.8 level and gave a convincing entry bar. What happens before the entry is very important. I don't like craziness.

3) you may be right with the success rate, but I typically like my candidates to stay within the :15 opening range. If price tags the fib. ext before a valid entry bar... I remove it.

General points:
Remember I also look at volume. If I'm looking to go long, I don't like my entry bar to be the 4th up bar in a row.

I prefer the preceeding bar to my entry to be in the same direction. So, if I'm looking to go long, I want the preceeding bar to entry to be an up bar. If the preceeding bar isn't in the same direction you're looking to trade, then the entry bar needs to be very convincing (again, see today's SIGM trade).

It may seem like I have a lot of criteria for entry, but it's not. Once you start looking at intraday fibs. and how price interacts at certain levels it starts to make sense. Also, I like trading off the 5-min chart because I can see more patterns and I feel I've become a way better chart reader now then when I solely traded the :15 and :30 (only last January or so).

Jerry said...

Yes, hi/low for the 15 min work best. but my research only have so little of this kind (maybe because of my scan)

Also, depend on the price action, many times 50% entries are just as successful. Of course, sometimes it bored you out to see it trade sideway til it break.

5 min is a bit confusing sometime, but I am getting better. Still I learned to switch to a higher time firm to make better understanding.

My old system was very similar to yours, but I was tried to change too many things. And I ended up forgotten it.

The last 1 1/2 months, I look for candlestick pattern for confirmation which work better. Still, fear is always the one who kill me. Away, it good to have a trading log to refresh our thoughts.

bl said...

oonr7,
nice work. I like 5min charts first hour or so and graduate to 15/30...5 min charts can have alot of chit in it as the the day wears on. Esp like it when the 15/30 slam into the 5ema and take off like sigm did. What a day: cbrl sncr rti cmi gil took off smartly from the open.I took on Briefing premkt list and noticed the brokers/metals in play with double reversals and all. Amazing. ADBE for lunch money. Wed should be interesting!

bl said...

edit-"chit"
"chit-chat"

bl said...

nr7
Speaking of 5" charts love the brokers: leh mer ms early fade, reversal to the 38fib and up. nice LEH 2/30 hammer and away we go

greytrader said...

ProphetScan down this morning...

OONR7 said...

you know... whenever there's a big swing in the markets, the next day prophet is messed up - bank on it!

Bubs said...

OONR7 just had a quick question for you. Are most of your trades made in the morning session? Also do you have any examples of trades you made after 1 ET? Thanks

OONR7 said...

bubs... I almost exclusively trade in the morning. Right now, I do not enter new positions after 12:30 (maybe 12:35 on occasion). I've just found that the way I trade (especially the 5-min charts) works best with the morning moves. I'm 6 hours ahead over here with 2 young boys so I don't want to be working till 10pm at night... so it works out great.

Bubs said...

Yeh thats what I figured from studying your trades. I have the opposite problem, I want to trade after lunch but can't find any setups I like. I fell like I'm wasting a lot of time in the afternoon. Most of my trades also happen before lunch.