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Tuesday, June 05, 2007

SWIR - 060507; 15-minute chart

SWIR is a variation of my classic "bread and butter" set-up - a set-up I don't trade much anymore because the reliability has dropped. But I could not pass it up today...

You can do a search for "bread and butter" at the top of the page, but basically it is a gap with a pullback to the retracement zone and a bounce at that level with the trend resuming in the direction of the original gap.

SWIR gapped up, fell back to the retracement zone, and printed a hammer with the sixth bar. There was also support from a rising 5MA. I did not take a break of the sixth bar high, but instead waited to see what the seventh bar did; it printed a narrow-range bar (the narrowest of the morning (NRM)) and I entered on a break of its (the seventh bar's) high.

The target was the Fibonacci extension of the previous day's low to the OR high, and it was hit three bars later. I sold 1/2 of my position at that point, and held the remaining 1/2 because of the strength and range expansion of the ninth and tenth bars. After a brief pullback and another hammer (twelfth bar), SWIR resumed the rally and I closed the remainder of the position at the end of the day.

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George said...

Nice trade. It wasn't on my watchlist. Love the blog.

Flatwallet said...


Of all your set ups, which ones do you think are the best performing ones.


Taylor said...

That was nice. Heard some of your interviews, and am new to your blog. Great resource, can't believe it is free.

Trader-X said...

flatwallet, good question. Let me give that some thought and analysis.

But not this set-up (generally speaking)!!!