I received a lot of positive feedback on the "reversion to the mean" trades I posted.
FCX was a good example of that setup today. It had a lot going for it - the first four bars put in a nice bottom, the 4th bar was a hammer, and the 4th bar also closed above the 50% level of the morning's range (not shown on the chart).
I entered on a break of the 4th bar's high, and my target was the 13EMA which seemed to be a nice compromise between the 8EMA and the white dotted line which represented the 1/2-way point between the low and the 50% retracement (note - my Fibonacci lines were plotted in classic X style...the previous day's high to the OR low).
I closed the position at my target. Note how price actually tagged the 1/2-way point between the low and the 50% retracement which turned out to be the high of the day.
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1 comment:
Nice trade. Good example.
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