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Wednesday, January 11, 2006

KMG - 011106; 15-minute chart

Near perfect hammer.

1.) What did I see?
A gap up and wide-range first bar. The second-fifth bars "roll-over" and fall to re-test the morning low and the retracement zone from the previous day's low to the opening range high. The sixth bar forms a near perfect hammer and rallies to close strong and above the retracement zone.
2.) What is the entry?
A break of the sixth bar high.
3.) What is the exit?
1/2 closed after $1 gain. The other 1/2 was held for a target of the morning high - it was not reached, and the position was closed at the end of the day for a nice gain.

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