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Tuesday, November 18, 2008

CA - 111808

CA gapped down and rallied off the low to the 50% retracement (my Fibonacci lines are plotted over the previous day's high to the OR low).

Price made three attempts to break through that level, and failed three times. I drew a short-term trendline across the two pivot lows, and entered when price broke that trendline; my entry was a break of the candle with the long upper-tail (indicated by the yellow arrow).

Price fell back to the OR low, and I covered at that point.



bl said...

I must get into the habit of using trendlines: they seem to work pretty well. Nice trade.

Trader-X said...

I have a love/hate with trendlines...when they are obvious like in CA, it is a great tool. But many times they aren't as obvious and there are so many different ways you can draw them. That is why you don't see them in my charts often.