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Saturday, December 10, 2005

NMGC - 120905; 15-minute chart




I will post more charts later this weekend.

1.) What did I see?
A gap up and strong first bar. NMGC makes an orderly pullback in the second and third bar, with a strong fourth bar that closes back above the opening range high (set by the first 15-minute bar). The sixth bar pulls back to touch that opening range high (resistance now becomes support), and forms a nice hammer.
2.) What is the entry?
A break of the sixth bar high.
3.) What is the exit?
The target was the Fibonacci extension of the previous day's low to the opening range high (top white line). It was hit before 1:00.

Notes - some of you may have entered on a break of the third bar high, arguing that the bar was "hammer-like". I have no problem with that entry, just watch the opening range high for resistance. If price stalls out when it reaches that level, you want to be quick to exit.

The total move for this trade was just over 13%.

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