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Monday, November 17, 2008

FCX - 111708

I had some technical problems this morning, and was not able to trade until a few hours into the session.

After some quick trades in the NQ, I saw FCX rally to resistance at the 50% retracement (Fibonacci lines plotted from the previous day's high to the opening range (OR) low). As you can see on the chart below, it printed several bearish candles with long upper tails and was never able to close above that level. Price formed a "hanging-man" type candle, and I shorted on a break of that candle's low.

Price declined through the afternoon and I covered at the end of the day.

note - this stock appeared on the Equity Watchlist for today.



Z said...

Hi X,

It amazes me that you can trade so well on faster moving time scales such as on the 5 min intervals. Have you made the switch because of the increase in the market's votility? Also, would you consider yourself somewhat of scalper since most scalpers use these very small time frames (ie: 1 min to 5 min intervals)?

-newbie trader

Trader-X said...

I think it is a progression. I traded 15 and 30-minute charts for years (10+), so my ability to trade 5-minute charts comes from experience. But don't be mistaken - I miss a lot more trades than I make, because there is no way to analyze a watchlist with over a few candidates and catch them all.

As far as scalper - I don't think I am by definition a scalper, as I associate that with trying to make a few dollars on a trade and moving on. I tend to catch bigger moves. But I do feel more comfortable with trades that develop, progress, and end quickly...so who knows.

Anonymous said...

"develop, progress, and end quickly"

sounds like my love life ;-)

i like trades where the gap close/fill corresponds with an "X" fib retracement area... add past support zone & perhaps indicator confirmation... those are high probability trades.


Trader-X said...

I need to pay more attention to the gap close, as that is a somewhat "hidden" level of support/resistance (depending on where price closes the previous day).