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Posted by Asher on February 7, 2008, 11:22 am
BS"D
Daytrading Course
Learn to Read the Tape
Exploit Pit Pivot Points
******************************
PIVOT MAGIC JOURNAL - EXCERPT
Good morning,
Managed to score a few points as Price Action oozed lower through the
Fed's faulty patch job. Now that the Bears have prevailed, expecting
a more serious collapse and some nice Bear range days to follow soon.
A leaky boat will tend to sink!
Be prepared!
Be well,
=] ;-)>
******************************
BS"D
Pivot Magic Trading
First rule:
"...Any time you don't know what is happening, get out!"
******************************
E-mini
Wednesday February 06, 2008
. . . [SNIP] . . .
2 = Classic, full-sized, Head-and-Shoulders/TTT (Third Time Through)
"P" type signal at
the Pivot. (For a clearer view of this formation, see the 10-Minute
line chart, bottom
left.)
Entry below the Pivot, of course!
A = Large red candle. Per our PMT stop rules, move profit-locking
stop above the high
of the candle, "free trade" and a bit. Nice!
B = DVS (middle chart) drives a large red candle into the "green
fog". DVS implies
potentially failing Momentum. We don't like to dawdle in the Ambush
Zone! Be prepared.
(For in depth discussion: See Pivot Magic Trading course book, Volume
II.,
"Strategy 101".)
Since this single candle puts our position in violation of the PMT
Maximum Profit
Giveback rules, place a mental stop at Giveback level.
C = Black Volume Bar of Death (middle chart). The instant the next
candle pulls back
from the Close and shows white, Exit Now! +/- 4.25 points
3 = TTT through the Close (clearly, a self-confirming set of signals),
right at the
1:30 Reversal/Action Time Zone.
D = Entry after Price Action exits the "fog", on second healthy red
candle closing
below the Close. This also permits us to advance the initial stop
above the Close,
reducing Undefended At Risk.
E = Failed test of MA. Per our stop rules, move profit-locking stop
above the MA.
F = DVS-driven (middle chart) large red candle puts the position in
violation of
Maximum Profit Giveback rules. Mental stop at Giveback level.
Whew! That was close, but Price Action ultimately continued with a
123 through
the Low.
G = DVS (middle chart) generates a large red candle stopping dead
against the S1
Support. This second DVS warns that Momentum has probably failed.
Maximum Profit
Giveback violation has taped as well. Place mental stop at Giveback
level.
Although in the end the next candle turned red, early on, when it too
bounced off the
S1 and showed white, there was no reason to give back the entire
Giveback allowance.
Experienced traders exited as soon as the candle showed white. +/-
9.25 points
Otherwise, we got taken out at the stop. +/- 7.0 points
. . . [SNIP] . . .
PERSPECTIVE
(Daily, bottom right chart)
Price Action has exited the tentative LT trend channel floor
(light blue channel lines). The Fed's desperate patch job
obviously didn't hold. They only managed to shore up the
market for a very brief time, and Price Action is already
"leaking" south.
Not much to say really; just be happy we are daytraders and
can profit in the short run, Bull or Bear, whichever way the
market moves, just as long as it moves!
Rather expecting the Bears to really go for it with a
vengeance now. But . . .
REMEMBER: Trade the Tape, Not my Prognostics!
Asher
=] ;-)>
Pivot Magic Trading Course
http://www.TradingThingys.com
Wednesday's PMT Chart:
Http://www.TradingThingys.com/PMTJ/PivotMagic020608.gif
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