Showing posts with label rule. Show all posts
Showing posts with label rule. Show all posts

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.