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Tuesday, February 20, 2007

GRMN - 022007; 30-minute chart

posted by Tom C:

Negatives - (1) 2nd bar could have been closer to the 5MA, (2) entry was below the OR high

Positives - (1) 2nd bar was a textbook hammer, (2) 2nd bar was in the upper 1/3 of the 1st bar's range.

I entered on a break of the 2nd bar (hammer) high, and sold two bars later at the Fibonacci extension of the previous day's low to the OR high.

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Roger said...

Nice trade. I saw it and passed because it was below the or high.

Eric said...

I traded a similar setup in USG. It didn't work as well, but I still made money.

Jamie said...

Nice work Tom!

USG was nice too Eric.

ADD Trader said...

Nice trade Tom!

Quick question. When you enter into a trade on the break of the previous bar (or OR), do you literally put the stop order in .01 above? I usually put my order in .05 above, and on the long side of .00 and .05 numbers. Is this a mistake?


FlyingJ said...

I do .02 above.

RobK said...

FCX on 2/15 on a 15-min chart looked very similar to this. A gap up with an inside hammer bar. Did any of you guys take this trade and what red flags might you have seen to not take the trade? Appreciate any comments. Thanks

Anonymous said...

robk, the entry was below the OR high. Price never really cleared that level with FCX. That is why X and Tom C. always say watch that level as it provides resistance...Tom listed it as a negative in the trade on Monday, and X always puts the disclaimer in when he enters below the OR high (or above the OR low). Sometimes those work, sometimes they don't...they are riskier trades.


Anonymous said...

That should be Tom listed it as a negative on his GRMN trade Tuesday.


Tom C. said...

add - there are no mistakes, you have to do what you feel comfortable with. Personally if I enter a stop order I do it .01 above the previous (trigger) bar. Of course, it it takes it out by .01 and reverses, I am hosed. But that does not happen often.

Again, I see nothing wrong with doing it .02 above or at the next .05 increment. Do what you think is best.

robk - I agree with what TJ said. Set-ups below the OR high or above the OR low are riskier - I take them more often than X, but X's standard disclaimer always applies.

RobK said...

Thanks for the comments everyone I appreciate it.