Wed. 7_25

Been a while since I've posted, I'll try to post more setups going forward.
 Previous day (7/24) was a 3d setup into the close.  Coming in to this day price tried hold previous resistance as support, eventually tested lower only to recover support.  The long setup was anticipation of a strengthening macd (1a criteria) following a reverse divergence.
The up-arrows indicate potential entry points (I took the 3rd one), while using the Fibonacci projections as exit targets.

SPY 2d

-Bullish trend in place (20- & 50-MA slope & distance) and price above MA's.
-Pull back into a support area (in this case the previous day's high) which often registers as a reverse divergence.
-Double bottom into the later afternoon (can otherwise be an inverse H&S or 3-push to a low).
-Price returns back to the breakdown point (continues in the direction of the trend).
I use the term "2d setup" to define the above list of criteria, as mentioned in previous posts.  So here is what it looked like in the SPY today; as an aside, had price rolled over under $133 (around the 1:30-2:00 hour) this could have been a potential short:

And so price is in the reversion to a mean phase, in this case the 20-day MA, which coincides with the 38.2% retracement.  (Pay no attention to the lower wick on the chart below, it appears I have to clear my cache).

tues 5_1

An example of the 2d setup that ends up reversing rather than continuing the trend direction.
The 2b setup often shows itself as an inverse H&S on the faster time frame and simply highlights a higher low in the pullback of a trend.  However, if price fails to push through resistance there is the potential for a 2b short setup, which is what we saw here today.  The long was scratched for a little more than b/e.

Fri. 4_13

Two trade setups from yesterday and today.
SPY 3d going into the close Wednesday that followed-through on Thursday morning.

The faster time frame of this pair triggered late (by the time it triggered price was at the 50% projection already), so for a quicker entry you can go to a faster time frame.  In this case, if you were still waiting for a trigger entry, you didn't get it until about $138.02 which was fine, so long as you stick to your target objectives.  In this case the 50% projection target was $138.34, or $0.32 per share for half of the position:

Today in BIDU
2d setup.  Reverse Divergence on the higher time frame, inverse H&S on the faster time frame.  Instead of taking the final half off at the 100% projection I let it interact with the IB-high to see what it would do into the close and let a faster time frame show signs of waning momentum

Thurs. 3_29

Updated from below:
Well, AMZN failed to breakout from its previous resistance zone from Thursday which would be an important factor in whether to hold a swing position.
As the 2d is an anticipation of trend continuation the previous day's high was essential to overcome.  Rejection of this level was reason to erase a long bias.  As the higher time frame's ascending triangle became more apparent, the faster time frame set up a 2b short criteria as price closed right at the trend line of the wedge.

I have been experimenting with day trading higher time frame setups.  So here was one taken in AMZN today.
The higher time frame setup here being the 2d criteria on the hourly chart (I use the 65 minute).  There were 3 potential entries on the trigger chart (20-min) for a swing trade entry (up arrows on the 20-min chart).

For day trading purposes however I'm looking at a still faster time frame (5-minute in this case, you could even use a 6-min chart to keep the 1:3 setup:trigger ratio since there are 65 6-minute bars in 1 trading day).
I missed the entry on the open which was a strong breakout of the previous day's resistance zone which quickly tagged all of the Fib. projections:

I did trade the late day setup which, again, was a breakout of the overhead resistance zone.  My exits (down arrows) were not based on the Fib. projections this time, but instead based on intra-day resistance/supply levels.   I'll update this chart to see how the swing trade worked out (or didn't work out).

Tues 3_27

I was watching for 2d long entries coming into today (buying pullbacks in bullish momentum).  Some just didn't set up, others failed after setting up.  One thing to be cautious of with the 2d long setup is a 2b short setup which can follow if overhead resistance isn't cleared.
POT - kept selling lower until finally I gave up on it.  The setup worked insofar as you got the breakout of the overhead trend line and the 50% projection target was achieved, but the other half of your trade would have been a scratch.

BIDU- I didn't trade this either.  The best setup entry occurred at the open.  Notice that price failed resistance and rolled over (2b short setup).

The SPY had two instances of this setup.  I tried trading the first entry on this but never got filled.  Again, the 50% projection was achieved but that was all.   Later in the day the 2b short setup triggered.

GOOG - a triangle breakout 2c-2d setup, exits at the 50% & 100% projections.  I took this long trade and shorted small size at the 100% projection level and got lucky, covered at the 50-MA.

GOOG cont.

A continuation off of yesterday's post with a trade in GOOG.
I may have gotten chopped up on an entry prior to the one taken (around 9:30), but I didn't get to it in time.

Later in the afternoon the 2d trade set up, but the entry bar was extended and so close to the first target it didn't seem worth the risk (I wasn't around to take this trade anyhow).

GOOG trades

I never really trade GOOG, but these past two days worked out for some trades.
First of all, Monday was a strong day for GOOG.  Yesterday price gaped down, but held a 50% retracement of the previous day.  For most of the morning price coiled within a narrow range before breaking out to fill the gap.  The original plan was for a trade only to the IB-high, but given the strength of the breakout the Fib. projection targets were in play.  This was close to a 3d long setup while the higher time frame was the 2d setup. (One entry and two exits).

Today, was a bit choppier for me.  There are a number of up/down arrows in the early session showing entries/stop-outs.  The first was a break-even trade, the second a stop-out of 85-cents/share.

Meanwhile, today's move fulfilled a 50% projection of Monday's momentum:

This was actually a great example of a 2d setup occurring on the higher time frame, therefore a swing trade.
Going back to the first week of March the Daily chart set up the 2d criteria while the faster time frame gave an entry around $609.  Today's price action came within $0.63 of hitting the 200% Fib. projection from the initial momentum wave occurring between March 6-12th and filled the gap left from January 9th.

SPY setups

Two setups in the SPY today going in both directions.
2d long setup: reverse divergence in a bullish trend where on the faster time frame we see a double bottom (or 3-push, or bear trap) for a move back to previous supply levels.

It may not seem like much as the first target was only 12-cents from entry (with an 8-cent stop) but take into consideration that 500 SPY shares equates to 1 ES contract and 1 ES point equates to $0.10 on the SPY.  So it seems best to trade this on the ES with at least 2, maybe 4,  contracts and scale out at each Fib projection target.  While with the SPY you can scale out in different proportions.  At any rate, this setup rolled over hard once returning to the previous supply level, $140.30 level.  Up arrow is entry, down arrow exits.

Price rolling over set up the 2b criteria which I brought up in a post earlier today.  As price hit the 50% projection the faster time frame registered a buy divergence and when it started selling towards the 100% projection and snapped back it formed a triple divergence, which was a warning sign to put a stop in place above that green inside reversal candle on the 5-minute chart. Down arrows are entry, up arrows exits.

Thurs. 03_08

Two examples of higher time frame setups that I have had my eye on for the past 2-3 days.  First an explanation:
As a matter of personal preference I like to set up my two time frames so that my "trigger chart" is 3-times faster than the "setup chart".  Most of the chart examples shown on this blog for instance are of a 15-minute paired with a 5-minute chart.  Beyond a 15-minute chart (which contains 26 15-minute bars) I also like to use a 39-minute (10 39-minute bars per day), 65-minute (6-bars/day), and 130-minute (3-bars/day).  The way I trade I essentially use the faster time frame and it's 3/10-macd as a timing mechanism for entering the higher time frame setup.  So, with that said, here are two higher time frame setups I was stalking the past few days which set up today.

LNKD -  The daily was showing a 2c-2d setup which boils down to a trending issue that registers a momentum reverse divergence.  I then look for a 3d setup on the faster time frame, in this case the 130-minute chart on the right:

So the 130-min had the 3d criteria going into the close yesterday, but so did the 15-minute chart (left chart in the set below) so I was looking to buy a pullback in the 5-minute fast line which presented itself in the form of a pennant or ascending wedge breakout at around 9:30 

KSS - My attention was drawn to this issue based on the 3d criteria on the 65-min chart.  When I see a 3d setup I look for the level of resistance which I feel needs to be taken out for a follow-through move higher to occur.    A helpful way of identifying this resistance is by looking to the 3a criteria which preceded the 3d.  In the chart below the 3a criteria showed resistance to be at the $48.55 level (thick blue line).

So this 3d setup was triggered before the close yesterday but today came the $48.55 test which was taken out 20-minutes into the day.  The 50% and 100% projection targets weren't large winners, but the important lesson for me is to be consistent with familiar setups.

Overnight ES

Just a quick look at the ES overnight pre-holiday edition.  Whatever it does likely will not include the higher time frame "big money", but it is what it is.  A split view of the 15-min (left) and 5-min (on the right).  The 15-min is showing the 2c-2d criteria (pullback following bullish momentum while showing a reverse divergence) while the faster time frame is setting up the 3d criteria at support.  Looking for price to break the overhead trend line (on the 5-min chart) and the fast line turn green.

Well, it had a rough go of it, but was able to test higher without breaking down from support.

Copper Rally in the making?

Interesting  bullish developments in Copper.
The daily time frame broke out of a symmetrical triangle with decent volume after consolidating a strong sell-off.  The weekly showed that regardless of the strong momentum behind the September selling, price consolidated constructively above a previous swing low (above $3.0).
This symmetrical triangle breakout gives a measured move which coincides with a 50% Fib.  projection off of the seed wave which has formed since the October lows.

Look at the monthly chart and we get even further warning that price could rally hard from this point.  After all, price broke down from a trend line that was in place since the January '09 lows and a throw-back to this trend line wouldn't be out of the question.
So, say we rally to our symmetrical triangle measured move (50% projection) but then fizzle out.  This could then set up a pretty blatant Head & Shoulders pattern (neckline at the $3.00 mark).

Essentially, a rally looks to be in the works, but it would be prudent to stick with fixed targets (namely that $4.14 measured move price point) as there is obvious overhead resistance to overcome.  Also worth remembering, should the breakout fail then longs will be trapped, creating a strong move in the opposite direction.

shorts mostly

FCX
  Reverse divergence short (higher time frame failed pennant breakout) on the bearish engulfing candle (6th bar) on the 15-min bar.  Cover on the momentum div.   Short again on the 2d criteria setup cover end of day

GS inverted cup w. handle breakdown corresponding with a 4d short setup.

JCP long based on a 3d setup.  With this much weakness my initial target for half was the PDL, while the other half was stopped out at b/e.  Always look to reverse when the 3d pattern fails.

AMZN ascending triangle breakout (3a long entry) turned fakeout.  Was a nice bear flag pattern into the close but I didn't revisit