Monday, October 29, 2012


/tf gapping down --  hurricane closing at 9:15

But notice -- one of the rules I created was that when trading countertrend (for a bounce), the minimum time for a base to form is ONE HOUR.

/tf bottomed at 7:30 -- tried to rise and failed.

Now, at exactly 8:30 - data came out and we see -- a HUGE tail on HUGE volume.  And more importantly -- it's been 1 hour.

The market is now up 21 ticks from the low of the tail and rising.

This is a familiar, repeatable pattern.  And /tf hits 804 which was my target area.

So main rule to remember -- an hour is minimum time for a bounce to occur.  But still need to see long tail puke candle to mark a bottom.

Friday, October 26, 2012

FRIDAY patterns:

tf  lower overnight but clear pattern developed:  1 to 7 am was a 3 touch flat support line and right around 7 am -- a test back to 810 for 30 ticks.   This is the same basing pattern that takes place again and again. 

Market probes for value.    VPOC is 812 on 5 min candles so that would be possible target.

AAPL reported -- crashed but now green at premarket.

/es at 1400 --

it's opex friday - so usually no range for last 2 hours.

/cl also established TL from 2 - 6:45 am and then a fast move.

The establishment of TLs after a sharp move precedes almost all sizeable moves.

EXPE +17%

at 7:15 -- 99 MA got on bottom -- then 80 ticks up --- 34 MA held up never breached the whole way.

IWM  82.34 is 10 day MA  on daily -- so /tf could potentially spike much higher on bear rally.

820 /tf  seems very far away -- but would be below 10 day MA daily on IWM.  Must know what's possible.

819.3 is VAH on  5 min chart  /tf.  So that is certainly realistic.

/cl  broke out of DT on 5 min chart.   air pocket above if it runs.
5/34 xover on /tf   1 min chart - looking for a short here for 15 ticks vs. 9 stop. on p/b to 99 MA.

short  /6e  1.2954 -- double top  on bank news ...   stretched.  price seeking away from value

/6e  - working - short at resistance.   . closed for +19 ticks  near 99 MA cover.  That was a good trade.

faded the crowded -- but not early!    incredibly  /6e - now bouncing up -- caught it almost perfect.

You are LOOKING For Trend Lines / Patterns -- wait -- they keep appearing

/tf -- 100 tick swing -- almost touched morning b/o level -- IWM 80.9 ---  feels oversold but no pattern of interest yet.  no double bottom, no triple.   But looking for it.   No need to be early.

Market Signals weak,  /zb rising.  and no Pattern at lows = still stay short or stay cash.

/tf -  so small triple bottom forms and pop but only to 81 -- and immediately failing again.  I really traded TNA for .10 which was a miracle.   That pattern was TOO SMALL --

significant moves require bases of at least several hours.

Again, my PLAN needs the 99 MA to be going in the same direction.  If not, all you can hope for is scalps.

/tf   xover     IWM 81 -- probably pin area  --  Friday's act weird.   But this is where you could try for a countertrade  into the 99 MA at 810.3 -- almost there.    And target HIT.  AND ,  fades immediately - that was to the tick, again.

/tf  sinks to 804 --  99 MA showing the way.   Entering breakdowns of 3 touch bases (when 99 MA is going that way) is usually a good trade.   

804  - PUKE candle.  So looking for multi-hour base

QQQ touched 200 day MA -- so it could bounce and pick up rest of indices or else they all catch up.

Tip: If you are struggling, say your trading plan out loud.... if it's hard to say it, work on it until it's not.

sideways action is not the same as going up -- that's why there are signals to rely on to keep you from NOT trading.

/tf  basing here -- it's almost been 1 hour.    20 ticks above the Puke Candle to 804.  Still hasn't been a 3 touch TL which is required to get long.

/tf -- there is a 5/34 xover.    /tf  rises into 99 MA  807...  looks bouncy here.

the move from 806 to 818 required a SIX HOUR base.  So maybe a half hour base is good for a 10 tick rally.  That might be a good rule of thumb.  If you want a big move, you want big base (and I cannot lie).

AAPL did have a more distinct triple bottom -- entry on next 5/34 xover was good for a nice rip.

.tf did not

/tf  - wedge complete -- now bounce or b/down?   26 ticks possible - to bounce to last break down area.  But Market Signals weakening.

LONG SIGNAL - /tf    1:31

And YES! - /tf does indeed run 26 ticks from b/o level.  What would be more genius now - is if it faded right here.  806 to 808.60 

As soon as the 3rd touch was formed -- a decision was made to keep breaking down or bounce, since we were oversold on  Friday -- bounce was very likely.  (AAPL had already bounced). 

out for nearly 30 ticks.   +$675 paper trading total. 

99 MA is now supporting -- TREND IS UP -- on shortest timeframe  /tf   1:39

/tf  pushed toward 810 -- which was a more powerful magnet - now back to 808.9.  A squeeze of course so needs to pullback and gear up for a new move if it's going to keep running.  810 will probably be it -- opex.

804 low was close to 803.7 low from 5 days ago -- one could have assumed it would fail there.

If someone is afraid of trading, they may be afraid of uncertainty.  There is no cure since all trading is uncertain.  You could trade a small amount (you should) and set your stop.  Each trade is not make or break.  So what are you afraid of?  Great poker players fold the majority of their hands.   Losing is part of the game, why make losing a source of fear?   Each small loss gets you closer to the next win.

and /tf curling back down. 

5/34 xover  /tf -- but 99 MA underneath.  This is NOT a continuation of the downtrend.  We are in an uptrend on the 1 min chart (in my book) so in reality -- this dip toward the 99 MA is a buy.

Since it's confusing - best to not take it either way.    Now got a 5/34 xover  BUY. So chop area. Still forming a base.

sharp bounce off 99 MA -- keeps you on the right side of the force -- back to the resistance area 809

bounce off 99 Ma -- good for 30 ticks to 811 -- wow -- 99 MA really working. 

AAPL -- BREAKING DOWN  2:45.  That's it.

/tf  810.3 -- well no surprise --   opex  targeting even number pin.  So really hard to get excited.  Chop for next hour very very likely. 

tried to short /nq early -- just got stopped 3x -- it was pathetic trying to hit the top.

/tf    60 ticks from buy signal -- 80 from low.   Hard part would have been holding it.

/es  /nq -- highs  both went green.  Hammer day.   

/nq - now 5/34 xover

/nq - dropped to 99 MA   recoverd half -- there is a huge price to pay for being early though.

/tf   810 -- PIN.   No surprise.  The overshoot to 812 was free money after the double top with tall tails on the 1 min chart -- that was a responsive trade.

spy/nq mostly flat ..  /tf rising AH -- -/45% --  outlier needs to catch up.  So pin doesn't hold.   812ish.

Respecting the 99 MA is a good idea -- never looked back after botttoming.

What I did well: focused on slightly fewer stocks.  Was patient.

What didn't I do:  Needed to hold the winners longer -- hold for target - or raise stop and let them run.

+$595 paper trading is respectable, should have been better.  But certainly shows progress.

What did I learn?  Markets can bounce sharply and if you see it, there's no need to settle for partial profits for being 100% right.  Ride as much as the wave to resistance as possible.  There will always be multiple signals before bottoms are made.  

Also realized how important long tails are -- often, quite often appearing at the bottom.  Use them, wait for them when considering a bottom formation. 

Thursday, October 25, 2012


I put in a paper trade long /cl  - because there was a clear TL sloping up.

Set a order to OCO at 86.58 -- and it was the top by 4 ticks --  now 86.39 -- for 78 tick overnight move.  The stop was just 9 ticks away.

Also got stopped on /tf overnight for -8 ticks.

Funny how when things are going so badly, the next trade ends up being the best one in weeks.

I am not focusing on /tf closely enough.

/tf  topped out at 817.8 -- just short of the 818 resistance area.    No surprise.

noticing how there's always some kind of symmetrical pattern - either clear 3 touch or 2 touch before each and every powerful move in either direction -- /zb, /cl, /tf -- on almost every market.

/cl broke wedge and went 40 ticks to new o/n high.

5 min chart -- shows 99 MA firmly supporting each bounce.

strong market signals.   with /zb sharply down o/n.

/cl up 1%,  /gc up -- looks like another commodity day.

entire  IBD leader list is green premarket...

/zb  - double bottom  so may not be going down anymore today.    

DDD is hot IBD stock of the day.   beat, raised guidance. 

AKAM  +9% 

8:30 data -- /tf  appears to have 30 tick swing in 3 seconds on data  --

/tf  815.80 - sharp drop on data.

daily charts are all in confirmed downtrend.   IWM  moving to 200 day MA.  Bear rallies can be fierce.

/cl - drops to the TL   86.20 -  good entry?   maybe on 5/34 xover?   support - but breached.   Market Signals weakening.

/6e in dt,   /cl  now in dt?    99 ma on top.   sell rips....

very strong Market Signals.  market up .7%  premarket.    TLT, VXX red.

/tf  at 818.4  - R1.     Should have expected that.    No signs of weakness.

/cl - had a perfect entry - but again, the tight stops are killers -- have to give it the room.  Lose more on these stops than bad trades.

/tf  818.6 -- now p/b.  99 ma showing the way.

/tf  821  at the bell -- then gap filling action  now 814.50 --  had to be willing to fade strength.  The very last thing most traders would want to do.  At double top resistance.

/tf  trying - but maybe bearish wedge? 

because today was a gap up in  a bear market -- it was correct to preemptively short resistance.

yes /tf - bearish wedge -- down to 813 from 821 -- gap fill almost complete IWM.

possible bounce /tf  813.8 broke DT.

now 813.   Still dropping.

Gap up days have different moves.   /tf  is still up .15%  despite 80 tick drop!

81.25 IWM -- gap fill?  5 cents left

/cl  -- SYMMETRICAL  TRIPLE TOP - AGAIN - BEFORE plunge and break of TL.

euro dying -- can't get long until there's a PATTERN.

PATTERNS form before moves.   Almost always.

11:15 am -- dead time now.   All the big moves are over.   30 ticks up, 110 ticks down.  /tf.

/cl  3 bump TL - break-- now good for 100 ticks.   

TLT  / /zb  gapped down to the open from 5 days ago - then bounced a point.

It's all about entering at the major sup/res. areas -- just waiting for a green light after the touch.

Best traders I know tend to make fast decisions.  They are really good at holding winners.  They tend to do the very opposite of what the market is doing during entries!  Hmm.  Maybe that's why they win.  They are way ahead of the crowd.  They are fading the crowd most of the time. 

buy signal  /cl  5/34 xover.  /zb  --   putting in a top...

market still really weak.  What's the crowd doing?  trying to buy a dip?

/tf new lows   99 MA - WORKS on a trend day.

chop and chop again AH.

Wednesday, October 24, 2012

WED. notes.

rally until 3 am -- data killed the markets -- or at least OIL.

/tf gave back to 815ish -- this is a value area.

FB +18%  wow.

AAPL  .76%

Some strength here.

long /cl on 5/34 xover after break and double bottom.

/cl -- moved up right away.  Good sign.  Stop raised.  MAs are bullishly aligned.

/tf  xover signal at 7:48  moved up 20 ticks still going...

FB +21%  -- Market Signals are quite strong... 

BA, PNRA, REGN, LNKD,  most of the Dow looks solid.

euro popped up.  /zb dropping fast.      Trend uppish kind of day.  Shorts on notice.

/cl  triple bottom -- small timeframe -- long tails.  And stopped for -1 tick.  Ah  was up 15.   This is why I hate /cl.  Always destroying patterns.  Paper trade anyway -- seems like it's impossible to catch those big moves.

At least I'm not shorting FB  like 2 tweets I saw.   +26.77%  now.  CRUSHED.

bearish 5/34  xver  /tf  now.  Today may be more rangebound.  99 MA trending up -- so this is not in a short term downtrend.   More like 99 MA test at 815.7

If FB shorts had heeded my -- don't short why 99 is beneath, they wouldn't be short... yet.

It's not rocket science, but it is discipline and patience.

When 99 MA is flat -- it's chop mode....  so what can you do? 

815.80 -- BOUNCE - for 10 ticks -- called it pretty close!

market popped  817.7   (818.40 target)

/zb  to 147.10  which was double bottom.

euro touched 1.299

/tf  818.1  -- 3 ticks away from double top.  Has to hit now...

818.40 -- and pullback instantly.

IWM - gap filll touch - -pullback 30 ticks to fill gap open.

long /tf  double bottom 812.20   10 t  stop:

stopped out - this was against my system....   lol.

99 MA on top -- trend down.

and /tf  sinks to 810 --  80 ticks off high....

Puke Candle at 809 /tf  -- and wide range candle... bounce?

/cl above 99 ma

/tf  -- trending up all morning - creating a clear TL -- touched 818.40 -- gap fill.... spike on the open then drop below the TL with 5/34 xover -- and that was the entry for 90 ticks.    TL + xover + 99 MA break..  + resistance area touched.  Combination of multiple signals.

The drop ended with the widest 1 min candle of the day on heavy vol.

It's not the xover -- What you really want to see is a TL formation -- this dictates the line of control.  Then you can enter with clear stop area.

/tf - after bottoming - creates a 3 bump TL -- bounces.   Market Signals were confirming -- was clearly going to move up from TL.  Now extended off TL.    813.6

since 99 MA on top -- we must assume all /tf bounces are going to fade away -- bears in control on1 min timeframe.

/tf - back to this countertrend trendline touch.  4th touch  812.3
paper short the break of the TL:  811.80  - this is a continuation trade.  5/34 bearish xover too.

and fake b/down

although  technically - looks like the TL was drawn incorrectly.    3 touch valid still.

/tf -- clear TL formed -- but now clear breach -- and 10 tick drop.  Had to be very clear on drawing the TL.

99 MA is trending down -- so correct to look for shorts, not longs.

/tf:  this is just a continuation from the bounce off lows -- so maybe beyond the LoD?  that would be target.

/cl  is weak  and 99 ma turned down -- no reason to go long  -- but many try...

/tf -- reverse double bottom at b/down level - and continuing path of 99 MA, sloping down.

99 MA -- keeps you focus -- cuz there are too many wiggles to tempt you to countertrade.

/tf  formed a small triple bottom near 810  then  5/34 xover --  Signal 3:  Divergence :   now

99 on bottom on the chop day.  But now -- dip buying ONLY.   Bulls in charge.  12:40

/cl  PUKE candle at 84.94 --  30 tick bounce....    5/34 xover.  No 3 bump pattern.

/cl -- ends up running 90 ticks after PUKE candle.  best entry is the point of max pain.  always.

Ended up making  a 5/34 xover and forming small TL before running (for 50 ticks off base)

So on a chop day:  can safely ignore  99 MA -- won't matter as market keeps crossing back forth.

triple and double bottoms and TLs will hold weight -- entries at sup/resist. willwork. (i.e.: responsive trading)

So essentially 5/34 xover going against the 99 MA requires a TL, double bottom or triple bottom to confirm entry.  above it does not.  (straight TL break is good).

small b/o  /tf  812.4  before FOMC meeting --  99 ma below -- bulls in charge short term timeframe.

Mixied market signals.

/cl  now has 99 ma  below -- bulls in charge.

long /cl  paper  85.70  on 99 ma test.   trending up wedge b/o - bulls in charge:   10ticks out.

fomc in 15 minutes...

/tf  folding down  but  /cl  -- is now uptrending with 99 ma below....    

at 3 pm  /tf   99 ma got on top -- then it was just a matter of entering at the top ofthe descending TL. with tight stop.

/tf  - perfect double bottom 809.2 -- then 15 tick bounce.  Symmetry entry pays.

/tf sinking to lows...   double top in the morning and 90 ticks to end the day.

basically 3 areas to enter /tf -- the double top at the open - andh then entry on xover, then triple bottom for 20 ticks... then long wait for descending TL  -- 99 MA gets on top - and short at TL for 30 ticks.

looking for symmetry (support) and MA confirmation.

99 MA is good but must wait for trending market.  Today's chop required more patience and a lot less reward.

/tf bounces to 811.70 at the close...  simply tested the lows, caught stops and ran.  Entries at the edges works well in chop days.

Must determine the kind of day -- then it's clear which trades will work. 

Tuesday, October 23, 2012

Tuesday Notes:

/tf  -1.28% premarket -- huge   12 point move overnight.  

Entire rally from yesterday wiped out and more.

Daily charts are below 10 day MA -- and that's the major trend.  So all up moves - like yesterday's are fleeting moves because they are fueled by short term timeframe traders.   Longer term players are distributing and can't find size up there.

99 and 34 MAs on 1 min charts are trending down nicely on virtually all markets.  (except /zb !) so there's no reason to jump in long.  Especially not so fast.

/cl has a 5/34 x-over after dropping under 88.   There will be bounces.  But trading long while the 99 MA is on top is tough without clear divergent behavior.   Trend fighting.

/cl  -- -1.5%  to 87.31  -- death trap to longs hoping for a huge bounce.  Early is wrong.

/cl  -2%  under 87 -- hit 86.68.   Still in sharp downtrend.  No relief.

5/34 x-over on /tf  -- 809.80ish.   This was the 3rd xover , other 2 were immediate reversals.

So going to open deep in the hole.  Must follow rules.  Could be tricky.

/tf  810.1    99 MA on bottom -- so officially uptrend on smallest timeframe.  Price pays all the time. 

/tf -- b/o  and small double bottom pattern -- before 20 tick POP in 2 minutes..   same old pattern.

Trend Down Day signals -- but possibly oversold on major gap down  (Biggest in 3 months).

Market Signals rule.     /tf -- back to the abyss

Fear is powerful.  Traders will act irrationally down here.  Charts will be the most truth you can find.  Feelings and opinions will betray you the most.

GOOG is green.

probably some ppl think gap will fill.   GOOG and AMZN green (amzn flat)... but that's not much to go by.

-2031 advn-decn -- is very heavy.  Need to see some improvement first before a long could work.

/6e - triple bottom     5/34 xover   10:04

advn-decn and /zb  suggest small bounce here.    divergent.

amzn and goog would be the right names to play.

99 MA on top is signalling the correct direction:  DOWN.  Keeping me out of going long.

CSTR, goog, amzn  all strong though.  

shorted /cl on break of wedge -- was 40 tick drop in 2 minutes...  after pattern completed and broke.  Simple.  Still dropping too.  Ended up being 80 tick move -- to 85.97  (whole #! break).  Now tiny bounce.

MAs and Market Signals are clear -- trend down horror day.  No need to get emotional, predict, overthink, form opinions.

/cl   5 / 9 MAs - no x-over would keep you still in  86.02 now.   10:32 am.

85.69!   crushed.

You know what the whole game is?  Staying in winning trades as long as possible.  If you have a system that does that, you win.  Otherwise, you end up losing even if you win 80% of the time.  Magnitude of wins must be greater, so your system must allow your winners to develop and slow to get stopped out.

Trying AMZN long ...   futile.   Double bottom +   5/34 xover.    only  -.37%

long /tf paper for 16 ticks on triple bottom pattern then 5/34 xover -- sold into first resistance area.

amazing exit -- /tf dropped all the way (15 ticks) to entry a minute later.   Wonderful read intraday.

Sold AMZN for $11.25 lol profit.

/tf failure was right at the 99 MA by the way --

/cl coming off the bottom but 99 MA on top...   We're in Chop Mode -- midday. 

-2178  advn-decn.  i guess a long time ago i'd be buying every hour hoping for a rally.  Not anymore.   It's a fool's game to fight the Flow.

slight bump  at 11:52 ---   /tf above 99 day MA but still above all.  

AMZN now up .77% -- this was correct to focus on strength.  CSTR also  green.

divergences now... /6e  strong.    /tf  at 806.50 -- triple top level.  advn-decn off lows -- still -2100

small counterrally in effect.   /6e  advn-decn  /tf  -- possibly fading as I write:  12 noon.

99 below in /6e  and now /tf almost ---   short term -- up.

So now - buy /6e on dips to 99 MA. 

long UCO -- risking $200 on double bottom + xover  + potential news in Iran.    also advn-decn improving.   

/tf  up 50 ticks after double botttom and 5/34 xover.   Still running hard IWM at 81.

CSTR  up 1.8% -- showed its hand early. 

that "news about Iran"  was exactly the thing you DON"T want to trade off.   TF up 70 ticks on no news... UCO red... because I thought I had information that was useful.

UCO - stopped out.  Of course.

missed the run...  feeling lost.   Head not in it. 

bearish divergences appearing.

"Bearish $CL_F knows where it wants to go -- $SPX $SPY #crude  -- tweeted at 1:43 pm.  85.94  (now 86.31   15 minutes later)...  

If you stay long when 99 is leading from bottom -- it works.  Otherwise it doesn't. This is a good rule.

/tf  above 99 ma -- trending up (stay long)  but  double top -- so could be early warning.  5/34 xover but then negated.  so Signal #3 pattern?

/tf  now it's a triple top  +  5/34 xover -- early short?   811.5

if trying to enter early... better to get in at the resistance area  -- rather than the break.. cuz it may have to retest several more times.   Not until  99 is leading from the top/bottom is it trending.

So  today's lesson:  Must respect the rules --- which I did not follow.    /tf running to new highs.

This is about discipline and following RULES.  It's why it's so hard -- you make it hard.

/tf 815  top -- what was the market trying to do?  Get to resistance -- this was the 5 - MIN descending TL.  Clear as day.  It was the gap fill in IWM.  The target was crystal clear from the start.

So always use higher timeframe to know where the market is targeting.

Moving Avgs.  keep you on the right side of the trade.  Longer term Targets can get you out at the top - but also keep you IN the trade to target.   Market Signals hint at shifts.   Patterns provide entries.

/tf looks extended as IS near a major resistance area but it is definitely not a short.

You don't have to anticipate, think, or worry if you are following a set of rules.  You do have to follow the rules and it often won't feel comfortable.

Market Signals look solid here --  Dow -209 -- that's why this bounce can happen.

Did I trade well?  NO.  I did not respect my system
What did I learn about myself? I think I'm smarter than my system and the markets.  I am not humble enough.  But I think I'm humble.

what did I learn about the markets:  They can really deceive you if you let it.  But in reality, the markets are NOT very good at tricking you.  I am good at tricking myself by not trusting the signals which are being very clear almost all the time.

/tf testing 99 MA -- still acting as support.   Market Signals are turning bearishly.

AAPL   -2.8%

/tf  loses 99 MA -- and regains it.  

closes at 813 --  More than obvious -- entire rally was simply to close the gap and nothing more.

Was actually a very good day for daytrading.   Following a system will provide the most gains.  Going off the cuff is disastrous. 

Monday, October 22, 2012


nasdaq up with AAPL bounce.

99 period  5 min. chart flat on /tf -- we're building value at 815 - 817  --  taking a rest after Fri. plunge.

/6e  rising    with   34 over 99 ma  on 5 min chart.   (flat on 1 min chart)

trying  EUO  but not looking correct. 


but all 10 sectors are red. 

KOL up strong.

good day for small chops and turns but not much else.

6e  has had 3 lower lows / higher highs -- channel.

FXE is above 10 day MA  daily chart -- so fighting an uptrend.

TLT -- stop was way too tight -- pointless.

IWM -- creates  double bottom --  the next buy signal resulted in best move of day. 

Always need to look for the double or triple bottom on 5 / 15 min. chart. 

12 noon - terrible time to do anything. 

/tf - -just broke out and pulled way back -- pure chop.

/6e  channel breaks  on 5 min chart  -- now looks like a wedge with b/o to downside...

/tf breaks but still no new lows.    AAPL up 2.5%

EUO -- up on the day.   TLT would have been fine.  Must allow $100 loss or don't take it.  Stop should have been low of day.

SPY, IWM, QQQ  below 10 day daily, now breaking 50 day MA... not rocket science... bears in control.

Market signals worsening....  /tf at lows.     /tf formed a wedge during lunchtime then broke to downside -- providing nice move.     3 touch TL formation again was key.

IWM -- triple touch -- flat.   Possibly supportive but no reason to think it can hold.

clear  3 touch TLs -- developed twice before each /tf plunge.  Same pattern over and over.

If you can't see it, wait for it.  It was clear the direction with the most power is down.  It just took time intraday before it overwhelmed the daytraders.

/tf  bounce after 813.10  touch.   No 3 bumps,  no divergent signals.... no reason to try long.  Would need to see clear triple bottom.

/tf -- double bottom on 1 min chart.  Not enough to get long.

at the moment:  terrible place to short... but not good enough to get long... typical.

/tf -- triple bottom on 1 min chart.   Not convincing but may be good for 10ticks.  813.8 entry would be in... just watching it though.

Every sector I watch is red so I'm calling this a Trend Down Day -- therefore, no long signals are valid.

/tf  pops  18 ticks off the 3 bump 1 min.  My own signal was valid.  That's why it's a signal.

/tf  has developed a clear support line trending up.   STrong tick at 2:30

AAPL  almost +3%f

shorting /6e is foolish.... it's green.  Meanwhile,  /cl is weak -- having massive trend down day.  Focus on weak to short, strength to get long.  THEN apply your signals.

/tf  815 --  up .05% --  nothing day .  low volume.      MAs are xover to bullish but not really ready to move.   AAPL    +3.28% was the star.   It was correct to get long on its strength at the open.

/6e  up .21% -- it was incorrect to hope for a big drop.    /cl was the big loser.d

So main lesson today:  What market is bringing its A game?   AAPL was blasting off from the start in a weak market.   That's what you go to for a long.

/tf  now has 99 MA on  1 min chart at the low - so in an uptrend on this very short timeframe.  Shorting no good until we get a signal.

big lift into the close --    99 MA got to the bottom and it was game on.  ADVN_DECN  signalled strongly at 15:09 -- giving plenty of time for 30 tick move in /tf

AAPL  +4%   was the tell.   But still required waiting until 3 PM to get it on.

/tf -- all the way to 820 -- after the green light -- so 55 ticks.  Patience would have paid.  But more importantly, follow the trend and MAs and signals -- they won't lead you astray.

Thursday, October 18, 2012

Thursday Notes:

Flat open at 8:15.

aapl, amzn red.

BAC, EWG green.

Whole problem for years has been not allowing winners to pay for losers.  

The psychology of trading trumps methodology.   Inability to follow a system will always destroy a winning system.  So to not make psychology the #1 focus is always a mistake.

Markets sag on   claims data.

AAPL no longer leading.

VXX, /zb  up --  so Market Signals clearly indicating weakness.

IWM 83.40 is the major support area to look for. 

/cl also dropping fast.   oil, materials were huge leaders past 5 days.  May pullback.(red premarket)

Reminder:  Strong names will pay, weak names will not. 

Key focus today:  Wait for market to hand you a lay up.  The trouble for most traders is taking trades they shouldn't be taking.  They hit their winners.  But if you also take a bunch of losers - it's a loss.  The ability to NOT take trades should not be underestimated.    Boredom is a major danger for the excitement-seeking trader.

Seeking excitement is not the same as seeking profits, the two goals are in fact, inversely correlated.

/cl -- sharp drop   5 xover 34  MA on 1 min chart caught 100 tick move -- still on sell signal.

x-over signals only work when combined with key sup/res. areas on chart.   Half the signals will fail or provide little profit.

High short int.   ==  extremely sharp, volatile moves.  Know your stock.  Know price behavior.

mixed day -- /tf --  wide range -- spiked to 841.40 -- clear resistance area - then drops fast.  Very choppy as expected.  Can't wait for x-over -- it's too late in a range   

EBAY, EXPE  - fast winners. 

Market Signals weaker --  IWM pushing down to 83.40 -- major support level.   Leadership red.   AAPL  -1.2%     QQQs almost below 10 day MA daily.

IWM -  at  20 day MA daily  level.  could be supportish.

/tf  double bottom at 835.50 - not a majorsupport level.

bot CIG - on bounce -- worst stock on my list.  got  5/34 xover after touching 12 support.  risking $120.   Below 10 day MA daily.  Really against the system.  Bad habit trade. 

/cl -- providing huge moves -- with a few small losses

NAV  below 10 day MA on daily -- this is not a buy.  Insider purchases don't change the signals.

/tf --  x-over into resistance at 839 -- may be a top but no sell signal -- nice bounce.

/tf -- shorted on 5/34 xover -- sold for 17 ticks - paper.   However, it was incorrect, supposed to hold.   Had two trades now .... for 40 ticks. 

Market now very weak.  GOOG   -68  on a miss.     shorting /cl  on 5/34 xover. 

note how NAV is weak -- holding around 20.50 -- always focus on those whole numbers. 

Almost entire IBD list red. 

OIH  up .85% -- rigs strong.   Charts were clear  days before the push.

/tf == sharp chop again -- near  KNOWN SuPPORT -- can take an early entry (TL break)

/tf  chopped 4x  -- imagine it's gonna get tighter now...   this is absurd. 

x-overs -- only work if you know the structure --   sup/resistance.  If you don't's a gamble.

more huge weakness

Why are there clear 3 touch  support lines before big moves?  Probably because someone knows -- and requires 3 or 5 days to accumulate a stake -- so they have a key line and buy it up -- then let it fall back down to the line.   

This is why you can't buy weakness -- someone could be pushing the stock down for 7 or 8 days before ramping it.   Or there is bad news.   Either way -- you step aside and re enter. 

So if you don't know   clear  support/resistance  -- then buy AFTER a 3 touch line....shows support or resistance midday -- then usually break in direction of the TL as  buyers/sellers overwhelm.

5/34 xovers work best at major support/res.    /CL just topped at 15 min high from days ago -- then x-over results it very fast drop.

EURO - dropping fast now --  took 2 days to top out -- then finally  drop -- sloppy  3 touch TL but still a TL formed before the final break.

/tf -- breaks support  AH.    Hmmm.   

Wednesday, October 17, 2012


/tf  - powers up strong

all Market Signals rage at open.

/tf climbs to 840 -- then a tall  double top  -- 2   1-minute candles... and a TL break -- leads to swift 20 tick pullback to 99 MA.

5/34 xover on 1 min charts  had some nice entries for /tf -- just have to follow this nice system.  Using Market Signals and  DAILY CHART to figure out where it might top out --  then where it needs to test support. 

guessing:  83.40  touches on p/b

bot NAV on call buying -- so far -- broke above 15 min chart.  Holding.   Like this one. 

bot and sold ROVI near support -- but sold too soon.  

dumped CIEN (Red on a strong day) -- ended up going much lower --   smart.  I listened.

NAV - tempted to sell it early.  That's a bad habit.  Focus on something else.

your emotions will always cause you to make the worst decisions.  Your system will let you perform best.   Overriding emotions is the ENTIRE game.

Got off my game -- tried to buy weakness, CIEN -- lost 2x.  Only strength pays.  Bad habit. 

ITMN  -- +14% --was calling all day.   That was strength.  Buy price action, not opinions.

Tuesday, October 16, 2012


gapping up

Market Signals strong to start

up:  EWP, EWG on news,  fcx, euro up huge, /zb down big, SPY, aapl, amzn, xlf.

No reason to consider shorting early.

/cl is wild choppy.    /cl is a different beast altogether.    /cl can only be traded by monitoring the major sup/res areas -- then waiting for the big moves / extension and riding it back the other way.  Playing the middle is pointless.

CIG -- gapping up after a few days above 10 day MA -- daily MA rule in full effect.  (follow strength!)

9:19  sell signal   /tf      (unsure because Market Signals are mostly green)

/zb strengthening --

gap up -- then continuation.   signal was good for about 25 ticks.

Market Signals  trendup strong.

stocks are always looking for support/resistance levels to overrun -- take out stops -- that's the purpose of daily movement -- to take people out at the worst times.

daily swing buys need to be held for daily swing targets -- not peanuts.   Usually take 5 - 7 days to fulfill -- not an hour.

every big move has a tight consolidation pattern before it.

bot MRVL - .20 stop -- below 10 day MA is bad.  Heavy call buying is good.  Above 15 min. chart.  So clear support area must hold 8.70 or out.

/tf  double tops  then pulls back 20 ticks fast -- playing  straight TL breaks would work today -- really more of a range bound after the gap up.

AAPL -  could buy as soon as 15 min TL was broken -- simple as that -- ran 14 pts.

LXK -- above 10 day MA today -- will it run now?  My main system says yes.  Made a nice multi-touch bottom before today's breakout -- so lots of accumulation lower

the market is mostly in chop until --  moving to support to resistance.  Your job is to know the levels and then place a bet.  You won't know the outcome, but you can lose less on the ones that fail.  That's the edge.  Knowing the market well, and honoring the entries/stops.

MRVL closed strong.    /tf mostly flat all day.  

A lot of ER.  

Monday, October 15, 2012

Observations: Higher Time Frame

/cl creates a clear descending 3 touch pattern on  5 min candles at 92.20 -- which is high for the morning then begins a nice descent, creating a triple touch TL along the way.  Currently at 91.30 for 90 ticks.

Possibly going down all the way to 91.04 which is where it originally broke out -- we shall see...

Posting these comments real time.

Iran -- negotiating is bearish for oil -- so catalyst exists.  

now 91.12 - almost there.

blam!  all the way through to 90.80 on massive volume -- stop hunt.  

One could have entered the short late at 9:02 -- entire day is OVER in 18 minutes (for 100 ticks).

90.50 -- still getting crushed....  should bounce soon.

bot JNS -- it was weak, thought insider buying would save it, stopped out.

bot AMRN -- strong on heavy call buying -- profitable immediately despite weak market.  Strength pays once again. 

/tf  bounce -- of 30 ticks after the 3rd green 5 xover 34 -- needed to break 5 min. then double bottom -- a classic pattern I see often.  Looks like topped out at resistance.

Levels are much easier to see on 5 min charts.    1-min is way too choppy.

/tf -- that bounce went all the way to resistance -- top of the morning levels.   nearly 60 ticks... once again 5 min charts plot the major targets

824.9 -- that was a triple touch --  so would look for top out here.

1:30 pm:  market slows way down as usual.  Once again, best swing are in the morning.

34 ma over 99 ma -- trending up -- rule is -- no shorting.  Which is wise so far even though AAPL is red and it would SEEM like shorting is a good idea. 

shorted /tf on paper on 5/34 x-over -- felt like late entry.   Set a cover 21 ticks lowered - and hit it, market immediately bounced -- was a perfect read.   Market Signals were strong -- knew it couldn't die.  But waited for signals and took no heat on traded.

Strong Market Signals -- realized market couldn't drop -- so it closed at the highs -- /tf touched a TL on 5/15 min chart -- higher timeframes are the targets to look for.

Saturday, October 13, 2012


Traded ESV.

First trade, entry was just based on break of 5 minute candles but the actual entry was not at a clear support area on the 15 minute chart.  This trade broke down as the overall market was weak. 

I chose ESV because it was above the 10 day MA daily.

ESV traded down to a clear support area.  (A breakout area from a few days earlier.)  It tapped it 3 times.

I bought it again with a tight stop.

This entry went on to rise .50 but I sold too soon for .25 instead of waiting for even number resistance at 55.00.

/tf    moved like I thought.  Wide range in the morning with one big push up to even number 83 and then trend down all the way past 820 and then chop around 820 for last 2 hours. 

Key points:  Using 5 minute candles to wait for the true support/resistance areas to find the best entries. 

These major levels only get hit once a day and provide outsized rewards with little risk.  Good trading means less trading with better results.

Tuesday, October 9, 2012

Swing Trade system:

1.  Are the markets in uptrend or downtrend?

Determined by  10 day MA on daily chart.   (Currently in downtrend)

2. What is strong?

Strong stocks are, obviously, going up, even on down days.  Is the stock over the 10 day MA?  Good, it's a potential long.

Did it recently break the 15 min  TL?  Good - that breakout level is the first stop.  However, if it gapped up and then broke through, the stop is lowered to the first print of the gap.  (So it will sometimes be below the b/o level of the 15 min period TL.

3.  Raise stops as it works.   Each  triple touch or double bottom marks a support area and becomes the new stop.  Take profits if it rips into old resistance.  But no matter what, the max. loss is always defined. 

You never average down.  You could average up as a support level is defined and breaks above 5 min. TL. 

Monday, October 1, 2012

wider stops

initiated a short -- with a 5 tick stop because I didn't want to lose. 

Well, it went one tick higher, stopped out, then dropped 60 ticks.

So fear of losing via a tight stop results in losing.

The correct stop should have been 9 ticks away.

What I'm looking for is a double top or triple top then some kind of divergent confirmation.

You must get comfortable with taking trades and taking losses, and then you can take winners, too.

Getting comfortable with winning....