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Tuesday, December 12, 2006

Fed day-trading

posted by Tom C:

I tried to short EPIX off a break of the 3rd bar low - it was similar to the VNDA short X talked about last week. But, my broker did not have any shares.

I caught MAMA on a break of the 9th bar high - that bar closed above the OR high, and had solid support from the rising 5MA. It provided a profit of ~7.5% at the Fibonacci extension, and is still going! As X says - low price, high volume, nice set-up = great potential.

DPTR was a nice short on a break of the 4th bar low* (riskier entry) and 8th bar low (more conservative entry).

LOGI was a beautiful short coming out of a tight morning range. The 8th bar left an upper tail at resistance from the declining 5MA, and it closed right above the OR low*.

I hope everyone is having a great day.

(all the above are 15-minute charts)

*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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7 comments:

Randal said...

MAMA was a monster. Good trades Tom C.

Mike said...

I don't have the hang of this yet, but I keep trying and hopefully learning. Today, trading HANS off the 15-minute candles, I went long at 35.05 during the 8th candle break of the seventh candle high. I was stopped out at 34.83. The seventh candle was a narrow range inside, almost hammer candle. The eight candle traded through and above the 5 period moving average when I went long. The only negative I see is that the trade was below the opening range high. Anyone see anything I am missing as to why I should not have taken this trade? (Here is my chart http://tinyurl.com/vwyj5 ) TIA

Michael said...

nice catch on MAMA!

Anonymous said...

Mike, I know this is not an X trade because he would have been looking for either support from the retracement zone (bread and butter) or a break of the OR high with the MA as support.

You were just entering hoping for a bounce off the 5MA. One thing that jumps out is me is the long tails on the 1st and 2nd bars. To me that means sellers came in, and there was probably overhead resistance.

Just my two cents.

TJ

Anonymous said...

Also, the first two bars moved almost $2. My other concern is that HANS "shot its load" with those bars, and did not have any steam left to go higher. That is a pretty big run from the open.

TJ

J said...

MIKE:

HANS 7th candle is a weak red inside Harami below the OR HI. That is a definate sign of weakness and should be a pass. The 30min chart really shows the tweaser effect in play with the 3rd and 4th bar combination. A tweaser setup many times leads to a reversal of the prior trend.

There are definately better setups to be found that would pay dividends.

Mike said...

TJ and J, thanks for your feedback. Tomorrow I try again.