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Wednesday, October 25, 2006

MICC - 102506

posted by Tom C:

Earlier today, Kayak posted in "Comments" that he traded MICC on the 30-minute chart. I traded it on the 15-minute chart, and both provided good entries and a great trade.

Price gapped up and consolidated near the high. The entry on the 30-minute chart was a break of the 4th bar hammer which had support from a rising 5MA. The entry on the 15-minute chart was a break of the 8th bar high as it rallied off support from a rising 5MA.

Trader-X edit - great trades...note that both entries were below the OR high, so the X disclaimer* applies:

*as with any entry below/above a previous high/low (in the case of my charts, the opening range (OR) high/low), you need to watch for resistance/support as price approaches those levels. If it stalls, you want to exit. If it breaks through, the odds are good you will have a move to the corresponding Fibonacci extension.

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BigBux29 said...

Very nice Tom C. and Kayak. WHere did you guys exit?

Anonymous said...

Don't know about Kayak, but I held through the Fibonacci extension (it didn't even pause) and sold on a break of the 11th bar low.

Tom C.

em said...

X, Tom C. - do you all ever look at the $TICK when looking to go long or short? Or do you strictly rely on charts for your direction?

Prospectus said...

Kayak and Tom C.,

Great trade! From X's blog, I understand the setup, the entrance strategy, profit target, the 5-ma support and all that. I have some questions about your entrance mechanics.

1. Say you have a number of setups that you deem worth watching for a key break to enter. Some will move early, some won't until later in the day, and some won't at all. Do you just enter stop orders for all of them and let price action get you in when/if the move happens? Do you watch volume, or LII or time/sales for clues about which will likely move, and then enter manually?

2. Do you have capital to take all of the potential setups you see, and if not, how do you prioritize the few to enter out of the possible choices? Do you go with the first mover, or wait for something else based on another criteria?

Anonymous said...

em - no, I don't look at tick

ex - a potential set-up appears or disappears every 15-minutes (or 30 depending on what chart you are looking at) - I just constantly scroll through my watchlist looking for candidates. I don't really look at volume, level 2, or anything else. Just S/R and candles

Regarding picking the best set-up, I follow X's lead and try to grade them and take only the best ones. I may have enough capital, but as he has taught me taking fewer high quality set-ups is a better option.

See his key posts at the top of the page for info on grading and taking good set-ups.

Tom C.