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Tuesday, May 12, 2009

POT - 051209

Posted by Tom C.

POT was a good setup - it gapped up and made a nice run. I plotted my Fibonacci lines in the classic X-style - the opening range (OR) high (the high of the first 30-minutes) to the previous day's low. The 9th bar closed above the OR high, and had solid support from the rising 8EMA.

I entered on a break of the 9th bar's high, and closed the position at the Fibonacci Extension (FE).



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7 comments:

Anonymous said...

im surprised at your entry- would figure bars 6 and 7 quickly coming off highs would warrant warning signals it might not break back to intraday highs?

Tom C. said...

I was looking at the big picture, and as I mentioned in the post price closed back above the OR high and had support from a rising 8EMA. Those were bullish signs, especially given the overall bullish gap and move from the open.

bl said...

Tom C, When I saw POT hit the 200ema/$100 I sol 110Jan10 with alot of time remaining but always can buy back.

Tajir said...

Tom, How did you manage your stop on this trade, was it low of trigger bar (bar 9) or OR support?
thx

Luis Miguel said...

Thank you for your effort posting Tom. A few questions: I traded POT too, but I entered at the hight of the 5th bar (hammer like) and I sold at the 138% FE of the OR (and also near a round number: 100$). My questions: 1)why did you entered later?, from your experience, was the price far from the EMA at the 5th bar to provide a low risk entry?...And 2) why were you expecting the 138% FE of the ORHigh-PrevDayLow in stead of the 138% FE of the OR?...while the trade was developing I was seeing the weekness of the market and I thought it could not be possible for the trade to arrive so high...but it arrived

Tom C. said...

Luis, yes my entry was based on proximity of price to the 8EMA. That it crossed and closed above the morning high was a positive, too. Your entry was good, but keep in mind that if there is a lot of white space between price and MAs more often than not it will trade sideways or pullback until the MAs catch-up.

Luis Miguel said...

Thank you for the advice Tom