Of course I'm referring to
Wells Fargo reporting "record profits" (yeah right!) giving the markets reason to remain bullish. Anyway, I keep to rules of not placing a trade within the first and last 30-minutes of the day. This morning I put in a limit order to by the base break (in SPY) on the 4th bar (5-min chart). As soon as I put the order in price launched away, leaving my order twisting in the wind. Anyway, I ignored my rules, but I'm thinking of amending that rule to allow myself to respond when price speaks to me, regardless of what time it is, so long as I keep it on a tight leash.
Anyway, price gapped all the way above
R2 this morning, based for 20-minutes before making a run to R3, where it stopped dead in it's tracks.

So, if you missed the small play early in the morning, and you weren't positioned to take advantage of the gap, you're left to wait for the pullback. Before noon price came back to test the lows of the morning (giving up the 20-EMA briefly). This is where I switch to the 15-min time frame to wait for a strong reversal (or continuation) setup. Today we were given a combination of a Tweezer bottom with a bullish engulfing candlestick pattern.
Also, looking at the 15-min chart we can see a good example of a
"Slingshot" setup that ocurred yesterday late in the afternoon (price reaching like, or slightly higher swing lows, while momentum made lower lows; leading to a "Slingshot" in price.

On the daily time frame we have higher volume for today's move, a tick up in
ADX (beginning of a trend?), momentum looking to get positive, and a 20- & 50-EMA crossover taking place. It would be nice to see a pullback to the moving average crossover, but ya gotta play what you get.
No comments:
Post a Comment