I chose the starting price as the bottom of the large green (momentum) bar, as it marked the beginning of the move up.
Showing posts with label flags. Show all posts
Showing posts with label flags. Show all posts
Wednesday, February 10, 2010
Dollar extension
I'm a little late on posting this chart, but it's a nice textbook example of a 100% Fibonacci extension out of a bull flag.
I chose the starting price as the bottom of the large green (momentum) bar, as it marked the beginning of the move up.
I chose the starting price as the bottom of the large green (momentum) bar, as it marked the beginning of the move up.
Thursday, January 28, 2010
solar flags
In a previous post I mentioned FSLR as it was approaching a level of long-running support. Here's a look at the weekly:
This week in FSLR has essentially been range-bound and looks to be setting up a bear flag (though the past two candles have been hammer's with very similar open and closing prices):
The $111 range has been bought swiftly 3 times this week, so if it's tested again we should look to gauge strength or weakness in the momentum/pace behind any ensuing bounce. Price above $116 (above the "W-bottom" apex) and we could look for a test of $118-$120.
Similarly, there's TSL. This stock has seen an amazing rally of around 1100% from the Dec.'08 lows (is that math right!?). Anyway, from it's highs back in July '07 TSL retraced 78.6% of it's losses in 1-year's time.
Immediately below current price levels is the 38.2% retracement off of the '08 lows to '10 highs.
The daily chart looks to be forming a bear flag, in which case if price breaks down from here there's a confluence of Fibonacci support (Fibonacci retracement from low to high and Fibonacci extension from high-low-high of the flag pattern) at the 50% ($17) and 61.8% ($13.50) levels.
Price seemed to have based upward all week along the lower edge of this bear flag, watch for a break down out of $22.
Similar patterns are also occurring in STP, and if you're into the penny stocks, ESLR.
This week in FSLR has essentially been range-bound and looks to be setting up a bear flag (though the past two candles have been hammer's with very similar open and closing prices):
The $111 range has been bought swiftly 3 times this week, so if it's tested again we should look to gauge strength or weakness in the momentum/pace behind any ensuing bounce. Price above $116 (above the "W-bottom" apex) and we could look for a test of $118-$120.
Similarly, there's TSL. This stock has seen an amazing rally of around 1100% from the Dec.'08 lows (is that math right!?). Anyway, from it's highs back in July '07 TSL retraced 78.6% of it's losses in 1-year's time.
Immediately below current price levels is the 38.2% retracement off of the '08 lows to '10 highs.
The daily chart looks to be forming a bear flag, in which case if price breaks down from here there's a confluence of Fibonacci support (Fibonacci retracement from low to high and Fibonacci extension from high-low-high of the flag pattern) at the 50% ($17) and 61.8% ($13.50) levels.
Price seemed to have based upward all week along the lower edge of this bear flag, watch for a break down out of $22.
Similar patterns are also occurring in STP, and if you're into the penny stocks, ESLR.
Thursday, July 16, 2009
nrC breakout
The SPY consolidated most of the day until breaking out. To keep things simple, here's a look at price on a 3-min chart. It exemplifies perfectly a high probability setup; a price impulse to the highs of the day, tight flag consolidation right at those highs, followed by further upside impulse. This setup is quickly becoming my bread & butter play across any security or time frame.
Not sure if today's breakout was irrational exuberance or not, but looking at a higher time frame gives me the impression that we're WAY over-extended. On this 60-min chart we have a gravestone doji at the end of the day, while the momentum indicator is correcting off the slow line in a negative way:
Here's another look on my standard 5-min chart of the SPY. Not indicated on the chart is the end-of-day bearish momentum divergence that is similar to that in the higher time frame above:
Not sure if today's breakout was irrational exuberance or not, but looking at a higher time frame gives me the impression that we're WAY over-extended. On this 60-min chart we have a gravestone doji at the end of the day, while the momentum indicator is correcting off the slow line in a negative way:
Here's another look on my standard 5-min chart of the SPY. Not indicated on the chart is the end-of-day bearish momentum divergence that is similar to that in the higher time frame above:
Tuesday, July 14, 2009
FUQI trade
I love the way the ticker FUQI rolls off the tongue. Thanks to Stewie for giving a heads up on this mover. The entry couldn't have been any more on time. A classic example of an impulse, consolidate, impulse move.
My target to the upside ($17.20) was based on previous resistance.
My target to the upside ($17.20) was based on previous resistance.
Monday, June 29, 2009
weak day
We did about as much volume today (third lowest volume day of the year, the second lowest being Friday's) as we did on Friday, with a little juke move in the morning that was fun while it lasted.
After gapping up on the SPY this morning price eventually worked it's way back down to the PDC where a short scalp was in play (target the lower keltner channel band). The lows on the TICK weren't very extreme after we put in our little double bottom where we quickly turned around. The highest probability entry was in waiting for the little flag to set up where we got stronger volume taking price higher. After that was just a mess.
We're sitting right on in a previous consolidation range
OK, Treasuries are ready to go lower from here, right?
After gapping up on the SPY this morning price eventually worked it's way back down to the PDC where a short scalp was in play (target the lower keltner channel band). The lows on the TICK weren't very extreme after we put in our little double bottom where we quickly turned around. The highest probability entry was in waiting for the little flag to set up where we got stronger volume taking price higher. After that was just a mess.
We're sitting right on in a previous consolidation range
OK, Treasuries are ready to go lower from here, right?
Thursday, June 25, 2009
measured move update
SPY completed it's measured move and filled the gap-down from Monday morning. It had a little trouble at R2, but pushed through. This last push registered a lower momentum high however.
SPY cont.
After our impulse move up this morning in SPY, we got a low volume retracement before continuing. here's the setup:
Here's where we stand on the 5-min chart. Using a Fibonacci Extension line we can project where our measured move could take us out of this flag pattern. We'll have to see how it plays out, but if it hits the target we'll end up filling the gap from Monday morning.
Here's where we stand on the 5-min chart. Using a Fibonacci Extension line we can project where our measured move could take us out of this flag pattern. We'll have to see how it plays out, but if it hits the target we'll end up filling the gap from Monday morning.
Thursday, May 28, 2009
shake-out
Price was nice and orderly on the gap-up for the first 25-minutes as we went sideways along the pivot line, forming a small triangle. Failure led to a nice swift move down. I mentioned a couple of days ago a strategy to play off of a gapping open that worked nicely today (if price gaps up, and price comes back to the previous day's close then look to go short, the opposite being true for a gap-down coming up to PDC. Of course the size of the move back to PDC is going to be a factor in making the trade).
Being that keeping count of Elliott Waves just hurts my brain, I like to use a more simplistic approach in following price structure. A count known as the "ABC" Price Pulse which I learned about through a L.B.R. presentation.
It's simply a price impulse, followed by consolidation, followed then by another price pulse. The following chart of today's SPY on a 5-min basis was a perfect example of this concept.
I have also included numbers (1, 2, 3) which represent another concept (again, discussed in the above link's presentation) where a price impulse tends to have 3 pushes to them. Also, take note that the "B" wave is a construct of a flag pattern. Allow the chart to illustrate, hopefully it's not too confusing.
Conceptually, it goes something like this; The A-wave is where volume/size comes in and moves the market after being in a sideways/indecisive/equilibrium level. The B-wave follows where the early-birds distribute (take profits) on part (or all) of their position, while late-comers join in and the additional volume brings price down in the final C-wave.
Anyway, there were a couple of things tipping off a potential bottom in today's early morning sell-off; a TICK divergence (also notice that the TICK didn't get overly bearish, even at it's lowest level), which also appeared on the 15-min chart as a momentum divergence, and to a lesser extent, the resilience of this lower channel line which given support on two other occasions (yellow support line within the 15-min chart).
Speaking of shake-out, here's a trade I got shaken out of today because (1) I didn't give it ample wiggle room, and (2) I was distracted with a 1-minute chart (hence the shakeout) , while I should have kept focus on the larger time-frame (5-min) and my strategy behind the trade. Why I didn't get back in is beyond me. The strategy behind it was a simple gap-fill, with confirmation given in the form of an ascending triangle and price basing at previous support.
Being that keeping count of Elliott Waves just hurts my brain, I like to use a more simplistic approach in following price structure. A count known as the "ABC" Price Pulse which I learned about through a L.B.R. presentation.
It's simply a price impulse, followed by consolidation, followed then by another price pulse. The following chart of today's SPY on a 5-min basis was a perfect example of this concept.
I have also included numbers (1, 2, 3) which represent another concept (again, discussed in the above link's presentation) where a price impulse tends to have 3 pushes to them. Also, take note that the "B" wave is a construct of a flag pattern. Allow the chart to illustrate, hopefully it's not too confusing.
Conceptually, it goes something like this; The A-wave is where volume/size comes in and moves the market after being in a sideways/indecisive/equilibrium level. The B-wave follows where the early-birds distribute (take profits) on part (or all) of their position, while late-comers join in and the additional volume brings price down in the final C-wave.Anyway, there were a couple of things tipping off a potential bottom in today's early morning sell-off; a TICK divergence (also notice that the TICK didn't get overly bearish, even at it's lowest level), which also appeared on the 15-min chart as a momentum divergence, and to a lesser extent, the resilience of this lower channel line which given support on two other occasions (yellow support line within the 15-min chart).
Speaking of shake-out, here's a trade I got shaken out of today because (1) I didn't give it ample wiggle room, and (2) I was distracted with a 1-minute chart (hence the shakeout) , while I should have kept focus on the larger time-frame (5-min) and my strategy behind the trade. Why I didn't get back in is beyond me. The strategy behind it was a simple gap-fill, with confirmation given in the form of an ascending triangle and price basing at previous support.
Wednesday, May 27, 2009
Wed 05_27
Quite a move there today. There was one head-fake breakout in the early morning before we settled into a range. The break of that range was ultimately quite fierce. Some things to point out; for most of the day we had a strong positive TICK bias while price bounced around in a range (perhaps a signal that "momentum" was unable to move price higher?).
Price basically chopped around within an upward sloping channel ever since yesterday's impulse move to the upside. After consolidating that upward impulse move, our next momentum push up was exhausted (momentum oscillator registered a tiny push up mid-way through the day). Curiously we find ourselves back to that lower channel line.
Here's how things played out; The initial "First Cross" entry (green dot in sub-plot) that was triggered was nauseating to sit through (the second green dot was a way of saying hold on a little longer). The first short entry (red dot in sub-plot) was golden, as it triggered an entry at the very beginning of the move down.
It's pretty amazing how quickly we've gone from one consolidation zone to another. Check out this 30-min chart where I have levels of consolidation highlighted.
Today was a perfect representation of a flag setup. First, we had a low-volatility range (which can be reflected in an ADX below 30, not shown). We had our impulse move (lays the foundation of the flag's "pole"), followed by consolidation (the flag itself), culminating in a continuation move. These continuation moves tend to carry some of the highest probabilities of playing out as we have to remember, everyone is watching and waiting for that flag to break-down, it's a self-fulfilling pattern.
So, the big question is....are we putting in a top, or was today simply a method of shaking out the carpet to see what falls out? Oh yeah, there's that Treasuries dislocation.
Here's a curious look at the SPY 60-min chart with nothing but 3-moving averages plotted, the 20- & 50- EMA's and a 200-Simple MA. Kinda looks like a pennant huh?
Price basically chopped around within an upward sloping channel ever since yesterday's impulse move to the upside. After consolidating that upward impulse move, our next momentum push up was exhausted (momentum oscillator registered a tiny push up mid-way through the day). Curiously we find ourselves back to that lower channel line.
Here's how things played out; The initial "First Cross" entry (green dot in sub-plot) that was triggered was nauseating to sit through (the second green dot was a way of saying hold on a little longer). The first short entry (red dot in sub-plot) was golden, as it triggered an entry at the very beginning of the move down.
It's pretty amazing how quickly we've gone from one consolidation zone to another. Check out this 30-min chart where I have levels of consolidation highlighted.
Today was a perfect representation of a flag setup. First, we had a low-volatility range (which can be reflected in an ADX below 30, not shown). We had our impulse move (lays the foundation of the flag's "pole"), followed by consolidation (the flag itself), culminating in a continuation move. These continuation moves tend to carry some of the highest probabilities of playing out as we have to remember, everyone is watching and waiting for that flag to break-down, it's a self-fulfilling pattern.
So, the big question is....are we putting in a top, or was today simply a method of shaking out the carpet to see what falls out? Oh yeah, there's that Treasuries dislocation.Here's a curious look at the SPY 60-min chart with nothing but 3-moving averages plotted, the 20- & 50- EMA's and a 200-Simple MA. Kinda looks like a pennant huh?
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