I hope everyone had a good weekend. Look for charts later today.
And, the new season of "Weeds" starts tonight. It is a solid, entertaining show and I highly recommend it. If you missed the first season, you can pick it up on DVD.
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Trader-X, Weeds
Monday, August 14, 2006
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8 comments:
It's hard not to look like a market Guru if your long on days like today. Here is a low risk trade with so far a 3.18:1 risk reward ratio.
MDCO on the break of the 4th red hammer on the 15 min. at $20.54 I am looking for a target of $21.10...it's currently at $21.08 with a risk of .11 cents.
Like the rest of you I have other bigger trades today but thought I would post MDCO because I think this is one stock that has good Fundamentals and good technicals for the long side trade.
Is MDCO really a good trade? About the only thing I saw going for it was that the 4th bar was a NRM (not by much). Other than that, the 4th bar closed below the 50% mark of the OR and volume at that point was about 29,000 shares. Were you able to get a good position size? Seems very risky... just wondering what X or others thought.
It's 11:18 central time and I am looking at FO hanging on the 50% retracement if it makes a break of the 11th bar I will buy in at $72.57 but because I rate this trade a C because of no real narrowing bars and it seams like very low volume on the downside makes FO move very quickly negative. My stop will be very tight at only .12 cents and share count will be less than the normal of what and .12 cent risk factor would normally be.
The trade was made on Automatic as I was writing this.
X or somebody...could you look at this trade for me and tell me if you would have done it?...thanks guys.
Hi EM, What I saw technically was the wide range first bar and the second bar was narrowing and stayed above the 50% area of the first bar then that somewhat nasty looking long legged doji then the fourth red hammer and the next bar broke above it...I also went on past fundamentals and technicals of MDCO and not fighting the market tape today.
MDCO just stopped me out at $20.94 for a gain of .40 cents per share on .11 cents risk...thats a 3.6:1 risk reward ratio.
I think you are right" 'the more I look at the bars the more other trades looked much better than MDCO and I probably should have past MDCO up and chose another that looked better.
Thanks for the helpful comment. Maybe my FO trade is questionable also.
got whipsawed today, very frustrating day.i took a trade in CAL(15 min). it gapped up and came down to the 61.8% level where it touched the 34MA and made a hameer bouncing off of it. got in on the break of the hammer. it rallied from there but i got stopped out.
i thought it was a good setup. any thoughts....
I don't think the 4th bar in CAL was a nice hammer - it was red, and had an upper tail.
TJ
On MDCO and CAL, notice that the early volume/liquidity was not significantly (or any) greater than the previous few days. It always helps to have above average volume to give some punch to the setups. It also helps for entry and exit purposes.
Yes Jim you are correct about the volume not being higher. MDCO is a low volume not under the major market radar type of stock that really beat the pants off of earnings...I think this may be one of my problems" 'mixing fundamentals with technicals and letting both control my trades.
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