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Saturday, November 20, 2010

Thanksgiving, email, and a few charts

As long-time readers know, I use Thanksgiving as my opportunity to give back for all the good fortune I have had over the years. In 2009, due to my "work" circumstances, I was not able to do much except contribute money. I am making up for it this year by being very involved in efforts to bring meals to a lot of people who need help. As such, the blog is getting little attention and I probably won't look at it much until December. Between now and the end of 2010, I will try to figure out if I am going to keep posting on a consistent basis, and if so what the schedule will be.

Regarding email, I have not checked it much over the past year plus. Last week, I logged in for the first time in a long time, and I have several thousand unread messages that have accumulated. So, if you have tried to communicate with me via email, I apologize. I probably will not be able to work through all of them and respond.

Having said that, one of the Subject lines in the top few emails caught my eye. Brian sent this, and I thought it would be beneficial to many of you:

"Trader-X, I am plotting my Fibonacci lines from the previous day's close to the current day's open and it really presents a lot of opportunities. 2-minute timeframes are too fast for me, but I am having a lot of success on 5-minute charts. I especially like setups that break out of the Fibonacci lines as those tend to be the ones that run the most. For example, ASML earlier today; I entered at 11:40 and sold when it hit resistance at the next half dollar level for a gain of 2.5%. I think this is what you call your beyond the Fibonacci Extension setup, but I am not sure it follows your criteria exactly. I can usually find one a day like this or one that crosses back through the current day's open after a pullback. I really appreciate your posts and hope you continue to do so even if it is just a few times a month. Most blogs I read now are inspired by you, and you have done much to help many people. Thank you again, Brian."

Here is the ASML chart Brian refers to - I have marked the trigger bar (he entered on a break of this bar). Brian didn't mention using Moving Averages, but I left what I use on the chart - as you can see, the 8EMA provided nice support for his entry.



Here is a chart I traded on Friday. It is quite simple - a gap up with the second bar falling below the current day's open, and the third bar attempting to rally but failing, leaving a long upper tail and a weak close. I entered on a break of the third bar's low and covered at the RZ five bars later.



Finally, I know there are a lot of questions in the comments - I have not had time to read, review, or answer. I will try to get to them after Thanksgiving, so thank you for reading and for your patience (long-time readers, please feel free to answer any comments you feel comfortable addressing).

_______________

19 comments:

bl said...

TraderX, Thanks for share. ASML beautiful 30 min chart 2/30" doji. Many nice 30 min charts w or w/o gaps:cpwm lng ah mgic hibb n fl >10%

Times of Your Life said...

hahahah both charts are very nice

Happy Thanksgiving...

Marc W. said...

X, I was reading your Five Rules on the Five Rules For Life Blog, which is a very motivational site by the way, and you mentioned you meditate. Do you still meditate and if so, how often? And, what form of mediating? It seems that there are more different kind of meditating than there are trading styles. I am looking to get into it, but was hoping you could provide insight.

Brian said...

Thank you for posting my trade, Trader X. I do use the same moving averages as you, and the strength of the 8 helped my decision to buy at that point. Have a wonderful Thanksgiving.

Brian

Trader-X said...

Thanks for confirming Brian. Marc, I meditate every day - it is the single most important thing I do for my success. It is a habit worth adopting, and I think you will find it has a drastic impact on everything you do if you stick with it. You can find a lot of information on the Internet about meditating. If you don't mind shelling out $40 or so, I recommend meditationshift.com. It is easy to learn and easy to stick with. Good luck and I may do a post in December about my meditation history and practice if it seems like there is interest.

Larry said...

Nice trade Brian, I traded ASML on the 3-min. Good setups work on almost all timeframes.

I have been meditating for almost two years, X. I concur that it is one of those rare things you can do that will help you improve all around.

Happy Holidays to all.

Javier said...

The talk of meditation reminds me of this that I saw on Reddit this weekend.

http://i.imgur.com/ZhFvn.jpg

Slow down, you move too fast! The point of meditation, no?

joshua said...

i'm interested to hear about the meditation.

Anonymous said...

Trader-X,

Okay, I'm really stoked. Paper-traded your "Beyond Fib Extension Set-Up" today, and it worked out great. Wish I'd taken it for real. :)

ARBA on today's 2-min chart (11/22/10).

Long on a break above 11th bar's high. Support found below at the 138.2% Fib Extension and the 8 EMA.

Exited on a break below 8 EMA (23rd bar).

This trade would have produced about 1:4 risk:reward in less than 30 minutes.

Thank you for your guidance! PLEASE let me know if I am mistaken in my analysis of this trade or the concept of the set-up in general. This was my first dry run.

Happy Thanksgiving!

Anonymous said...

Correction: ARBA exit should have been noted as being on the 23rd bar. If I wrote 24th bar, that was an error. Sorry. :)

Anonymous said...

Anon. How did you place your Fibs for ARBA?

ZJ

Jack said...

Hi everybody.

I think I saw the opposite of a "perfect pullback" in the YM futures.

30 min Chart
1. Set Fibs after first 30 min & wide red candle.
ORH - 11 059
ORL - 10 996

2. Price rallies in 2nd, 3rd bar. 3rd bar closes on 50% retracement.

3. Short break of 3rd bar (11 006)
(meaning 50% retracement was over and failed, with stop was high of 3rd bar 11 035)

4. Cover near the FE near 10 969.
(I covered at 10 974.)

Thoughts anybody on the setup and analysis?

Appreciate any comments bc I'm new on here trying to get rid of chasing success...

ZJ

Anonymous said...

I'd like to hear more about your meditating. I hope you had a Happy Thanksgiving.

Terry

Dave said...

I can see it now, Trader-X charts, chanting, and yoga!

But, I am interested that is for sure. I have heard a lot of positive things about meditating.

Anonymous said...

ZJ,

Sorry for my delayed response. I placed the fibs on the previous day's close and the current day's open, following Trader-X's recent trading system evolution.

Hope you all had a great holiday with family and friends. :]

Sincerely,

Chips & Salsa

Flowtastical said...

Trader X,

I know your exits are always the low of the entry bar.

Do you find that you get stopped out very quickly on alot of your trades?

Anonymous said...

Trader-X,

FNSR - 2-min chart, Beyond Fib Ext Set-Up

Entered on break of high of 10:20 EST candle. Stopped out below 8 EMA, then it took off later without me.

At 10:56 EST, a small reversal candle formed, but not above 8 EMA. It ripped straight up from there and is still moving.

I didn't take the second entry because it wasn't sitting "on top of" the 1.382 Fib. It was cutting through it, and the 8 EMA was not supporting it. Would you have taken the second entry anyway? Or another entry?

Any thoughts on how I could have played this differently to make the trade profitable? Did I do something wrong?

Sincerely,

Chips & Salsa

Anonymous said...

Trader-X,

Sorry, man, I guess my question is: Does the low of the candle you execute against have to be resting EXACTLY on the 1.382 Fib AND the 8 EMA for you to take the trade, and otherwise, you'll pass on the trade?

I read from an old post:"...I prefer the setup occur closer to (actually on) that line."

Maybe my FNSR entry was flawed?

Chips & Salsa

Trader-X said...

Flow, no not at all.

Chips & Salsa - what date on that chart?