AMLN,BCS,BP,FDP,FIS,FORM,IPI,ISIL,LEH MCD,NLC,PPC,
QGEN,TKLC,UBS,VOD,WSH,XIDE
PPC (gap down)
The first candle is weak and the next 3 candles are on the OR low. The 3rd and 4th both close below the OR low. The 5th is NR7 which tests the OR from below confirming it as resistance. This is our trigger for a short.
Entry: 20.60 Stop: 20.85
Fib Ext: 20.01
1R= 20.35 2R=20.10 3R=19.85
After entry we have picture perfect trending action down the ema.
I was away for the evening session, so would have been unable to watch the markets. Consequently I exited in 3 stages, taking partial at 1R and 2R and leaving the rest to close at end of day or on a $1 gain. Another reason for taking 2/3rds profit early on was the proximity of the decade $20 level, which could have produced strong support. A very good gainer though.
Just the one trade. I did have an entry order on VOD (7th candle short) but it never triggered. Other than that, nothing from my watchlist stood out.
9 comments:
I am so angry I missed PPC! Hope you caught it.
On that chart do you like the 5th candle NR7? Little lower wick is a little discouraging but the 6th candle would have been perfect.
Guess your post answered my question. Good catch!
What do you think of BCS 4th candle?
pdt.
BCS, 4th candle. If it had closed weak and/or been an NRB then I would definitely have traded it. Having said that, I wouldn't argue too much if anyone had taken the trade. Could have got 1R out of it and at worst would have been a break even trade.
Yea I was able to squeak out a little more than 1R, can't complain.
"If it had closed weak and/or been an NRB then I would definitely have traded it."
- This brings me back to my first post of the day. Why would you choose the trigger bar of PPC over this trigger bar? It terms of % the lower wick on BCS is actually smaller than that of PPC, so one could say it closed "weaker". Is the NR7 aspect the only difference? Thanks for the clarification.
pdt.
Yes the NR7 is the main difference. But the other factors which entered my thinking was that the previous bar for PPC was a NR3 so we had successive narrowing bars. This was a bit better than the 4th candle in BCS. Also the high of the trigger bar for PPC was closer to the OR and so had more going for it in terms the OR low acting as resistance.
Sometimes it is just a feeling and in this case the 3rd candle in BCS made me hesitate a bit, so I decided against it. In fact I would add, that I have seen the BCS trade pattern give good rewards.
Very good explanation. Got it.
Cheers
TR: couple ques:
(1) VOD would you have traded 10th candle b/d? (does not seem so different from your 7th candle trigger bar)
(2) LEH: 17th candle b/d (closed strong below the OR and rejected OR low and 5ema)?
(3) AMLN: 15th candle b/d? (liked the piercing of the OR low and very strong closed)
(4) EWA: 9th candle b/d? (I liked the NR7, the rejection of OR low and close below 5ema)
(5) KB: 10th candle b/d? (liked the 2 NR7 at OR low and strong close)
Thanks again for your feedback, Ralph
PS: I sympathize with the idiot savants who ignore the wonderful opportunity to tap into your considerable trading expertise. But choose instead to waste precious time on dumb rantings and useless mischiefs. Keep up the good work!
ralph.
VOD > The only reason that I didn't trade the 10th bar was because I was not going to be around for the evening and it was getting a bit late to enter a new position. I would have used the OR as my stop basis by the way.
LEH and AMLN > The AMLN trigger is more to my liking as it closes weak. In both cases we would be entering during lunch time. As this is sort of time when I'm away from my PC, I wouldn't have traded them. To be honest I haven't done any detailed analysis of the success rate of entering at these sort of times. Having said that, I know that sometimes they do work out very well and TraderX had some good examples of these entry times as well.
EWA > This is just about perfect. It wouldn't have been on my watchlist probbaly because it hadn't gapped far enough. The 6th breaks the OR and closes weak so would also have been a valid trigger. Then we come back to test the oR low. As you say the rejects the OR and ema and closes weak. Very good catch.
KB> Very similiar to EWA above. I wouldn't have traded it due to volume of 1st candle. But the price action is excellent for a short. I might have waited for the 11th candle just because we are in $60 area. The 11th opened above the $60 and closed below it and also tested the OR from below.
ralph..
By the way, good catches on the EWA and on KB.
On a general note, it does illustrate the fact that my criteria (e.g. vol of 1st candle > 150k, gap below yesterday's low etc) is not the only way.
You can apply these TraderX type price patterns on most types of stocks which are moving. As long as you keep your watchlist short enough to manage and keep an eye out for these sort of set ups.
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