Someone asked a few weeks ago what is my "bread and butter" setup. I don't know that I have just one, but if I do this is probably it. It is simple, which is always better:
1.) Gap up.
2.) Price breaks the opening range high (ORH).
3.) Price pulls back to the ORH with support from a rising moving average.
4.) Price rallies to the Fibonacci extension (FE).
I will post another variation of this setup (that I like even better) in the next day or two.
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12 comments:
I actually traded NVAX but I entered earlier, on the 8th bar break.
Nice blog, keep it up.
John
How about BA today?
Hey Tom great trade,
Just wondering what constituted the decision to use the 10min OR for the plot of the fib lines in classic X style. Ive notice the first 15min and 30Min used as the norm but not so much off the 10Min except for yesterday. Unless, i just thought, since the 1,8,9,10,11 bars found S/R in that area but other than that i am unsure
Thanks again
Zo
nice work...alot of sub $10 momo stocks
Tom,
What are your price paramaters or is it just based on % and Vol? then WL ranked by %, or Vol? tia
Zo, I picked the 1st bar because it was red and left a long upper-tail. When that happens, I often plot the ORH over that 1st bar and over the 3rd bar if it is different, and look for setups on both. In general, the ORH is plotted over the high in the first 3 bars, but I encourage you to play around with different configurations.
BL, yes. It is odd that I would trade two sub $10 stocks two days in a row.
Regarding WL, I only eliminate stocks over $100 and to be honest, there is not real reason - it just makes my WL smaller (I don't eliminate low price stocks, but I rarely have below $2 because they don't turn up on my scans). I do as X does and have it sort by r-t volume so the most active float to the top.
Anon - BA was not on my watchlist. It made a nice move after it broke the ORH.
Tom,
How do you find the stocks that you play in that gap up?
Anon, how X and I build our watchlists is detailed on the blog...search the links at the top of each page.
Tom: I've read the negative comment made by Evan to your previous post.
From my point of view, your blog (I mean the TraderX+TomC blog) is the best I know on daytrading in the web. Please keep on sharing, I think 99% of your readers appreciate the work and the effort you are doing to build this extremely useful content.
Thank you very much from a spanish reader: very well done!
Wow, just found your blog. What a wealth of information. I will probably spend all weekend on it.
:)
X or Tom C.,
Can you take a look at MITI from today (June 8) and tell me if this fits your criteria for a "Top Out" pattern? I use 15 MIN charts and it looked good to me, but I did not take the trade.
Any analysis you can provide is always helpful.
Thanks,
Tyler
Hey Tyler - that was a nice crash. I can't speak for X, but I find that the top out works best on the shorter timeframe, which for me is 5-minute charts. I like entering if the pattern forms after 3 5-minute bars. I find that the longer the timeframe the more that particular pattern is prone to failure.
But that is just me!
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