Did any one catch SFCC? Not exactly a "classic" set-up, but a compelling one nonetheless.
Price gapped down, and the first 15-minute bar shot up through the retracement zone, the previous day's high, and the Fibonacci extension. The second, third, and fourth bars then consolidated, narrowing in range with the third and fourth forming inside bars. The fourth bar was the narrowest of the morning (NRM), and a textbook hammer. Entry was a break of the fourth bar high, and the exit was a break of the eighth bar low. Total gain for the move was just under 10%.
Charts over the weekend, feel free to post your thoughts and trades in "Comments".
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Tags:
Trader-X, Stocks, Fibonacci, Trading, SFCC
Becoming Solution-Focused in Our Trading
4 days ago
18 comments:
It showed up on my list, I watched it unfold, I saw the hammer, but I didn't buy it. I am kicking myself right now.
X...didnt catch that one, however, i have added another arow to my quiver. I had a similar trade yesterday with LEN. A gap down then a hard retracement above all fib levels. Once thees stocks break previous days highs or lows, they explode. Great set up to watch for. Again thabks for everything X....
P.S. I did trade QSII 30 min. Ask yourself three questions. LOL
Interesting 5150. LEN was very similar. Good trading to you, and have a good weekend!
Hey X, are you having a lot of problems getting on Trader Mike's blog? It seems that I never can pull it up, or I get a "Not Found" message.
I would post a comment, but I cannot pull it up.
Chris - he is having problems with his ISP. He has written about it a few times over the past week. So, it is not just you. But keep trying. His new site looks really great, and he has alot of cool features.
It makes my blog look like its from the stone-age!!!
Trader Mike
Check out others on my BlogRoll too:
Tale of the Tape
UglyChart
Brett Steenbarger
Those are just a few, but they are all very good.
great trading guys.
im working today.
10% move in one trade... nice!
Best week trading ever. Even made money today (although I missed QSII). I say ye this merry friends - I will raise a glass tonight to Trader-X and quaff a toast in his honor saying loudly so all about can hear - "You da man!"
Have a great weekend.
Nice trade X.
Another good trades were QSII on 4 bar break (15min) and TRMM short on 9 bar break (15min)
Great week. Thanks for sharing so freely!
Thanks for the kind words John and everyone else. There are some good trades posted here in "Comments". I was able to catch the collapse in CECO, and am taking off to start my weekend. Have a good one everyone!
MYOG on the break of the 4th bar. I got stopped out.. the volume wasn't there in the move. Any other thoughts on the trade?
AAPL I shorted on the break of the 6th bar and then I went long when it broke back north.
I hit the CECO too on the break of the 5th bar.
Constructive criticism?
GREAT BLOG! THANKS!!!
Jon, my thoughts:
COH - I don't know what "Dummies" is, so I won't comment.
SCT - good trade. I am not sure why you exited...you said it looked weak, but on the 15-minute no bar took out the previous bar's low until it was above 6.50.
PSPT - should have been a winner for you (I would have probably took a riskier entry on a break of the 4th bar high). You said price dropped fast at 11:30, yet it never closed back below the high of the first 15-minute bar (X calls OR high). Price rarely goes straight up...it has to "ebb and flow".
ALVR - you made money. You said it showed weakness at the 1/2 point, and I see that it did encounter some resistance. I look for an actual sell signal at this area, and personally did not see one.
AQNT - again, dummies trade and I don't know what that is.
POZN - this is the first time I will say this out of your trades so far - I think this was a bad one. I don't see the rationale for entering where you did, and that late in the day. X always says probability declines the later in the session you go...and, I don't think an entry above the OR high of a gap down is high probability to begin with (although Tom C. posted SBUX yesterday, but that is the first one I have really seen on this blog and it was a better set-up!!!)
PSUN - not a trade I would have taken. It was above the OR low, and that second candle left a little lower tail (of course the first one had a big lower tail). Not a good set-up for me, as there were a lot better things to trade. I do think you should have covered once that engulfing took out the previous candle's high...that is a pretty strong signal as opposed to something just retracing up with a few bars (imo, that would have been fluctuation).
FVE - this is a classic example of what X says was way too wide range on the first bar. He always says that those really wide range 1st bars can mean the stock made the entire move alreasy, and FVE really fizzled out and collapsed a few bars later.
I feel you pain as I have been at this 10 years, and only profitable the last few. I know X has been doing it longer than me. You had several good trades mixed in here, but did not take full advantage of the potential. Keep looking and trying to spot them. Are you papertrading or risking real money? If real money, you need to lower your position size. It seems you usually take 1000 shares, as opposed to adjusting your position to the risk you are going to take - see X's money management discussions. Maybe you bail out of the winners because you have too much at risk?
Anyway, believe it or not I would say you are on the right track. I don't know if this helps, but have a good weekend!
TJ
John, Try the following - review all of your trades over the last several weeks with the goal of finding 1 or 2 common denominators (or basic rules) that will eliminate 2-3 of your worst trades (losers) each week. Eliminate = prevent you from taking the trades.
For example, from this week's trades, notice that your biggest two losers (PSUN and FVE) did not show enough volume increase relative to the previous action. The probability of an entry pattern working tends to increase with liquidity/volume. Note that X sorts his watchlist by volume and only follows the top 20-30.
Also, TJ pointed out two other basic rules that could easily eliminate a couple of bad trades per week - 1) avoid gappers with OR that is too wide, and 2) avoid entries late in the day.
If your are able to see this effect over several weeks of data, I believe you would be surprised at the impact to your bottom line. Hang in there.
Good points. One of my favorite X posts is as follows (it is taped to my monitor):
"IMO, the job of a trader is to wade through all of the set-ups presented to him every day and discard the bad and mediocre ones...if you do this, you will be left with the set-ups mentioned above and trading will be a lot easier and a lot more rewarding."
FVE: with Scottrade I have a very narrow OR(4-15min or first hour)of 10.29-10.40, then a break to the downside. A good short on my chart. DoI have different charts than you??
Friday was a tough day for everyone but the FVE trade probably failed because the market collapsed under its own weight 45 minutes after the open. Even though you are trading individual stocks the market has something to say about it. Remember the next time you see a moon shot on the Dow like that that only two things can happen - a sideways move or a downwards move. Very few stocks can go up under that kind of pressure.
Also watch the VIX on short term (5 min or less) basis. If it starts collapsing (as it did on Thursday around noon) it might be a good idea to close any shorts you might have lying around. PSUN fits that profile to a t. Compare the two on a couple of charts and you'll get the picture clear.
Just my two cents on John's trades.
With all due respect to John W., who I am sure is a very good trader, I have to disagree. I used to watch the overall market and VIX, and now that I don't I do alot better. That is why I read X's blog - he focuses on the stock and the price action regardless of what is going on in the overall market. He constantly has great shorts in a flying market, and great longs in a falling market.
If I am trying to guess what the overall market is doing and is going to do before I enter a trade, it just adds a layer of compleixty I don't need.
Good luck this week.
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