After the FED policy announcement, the QQQQ's fell precipitously, however, after the first wide range 5 minute bar lower, they came back up to test the $41.50 area, this was a low risk entry point with a stop just above the $41.50 pivot point. The fall was decisive with very little back and forth like we usually get. Since the market likes round numbers, I covered 50% at $41.02. I covered the balance when it was clear that $41.00 was going to hold as support. Note the capitulation type volume level as the Qs hit $41.00 for the first time, an hour after the policy release. (N.B. - Although this is not necessarily my best trade in terms of real $$, it is a good shorting example.)
Tuesday, March 28, 2006
Trade of the Day - QQQQ
After the FED policy announcement, the QQQQ's fell precipitously, however, after the first wide range 5 minute bar lower, they came back up to test the $41.50 area, this was a low risk entry point with a stop just above the $41.50 pivot point. The fall was decisive with very little back and forth like we usually get. Since the market likes round numbers, I covered 50% at $41.02. I covered the balance when it was clear that $41.00 was going to hold as support. Note the capitulation type volume level as the Qs hit $41.00 for the first time, an hour after the policy release. (N.B. - Although this is not necessarily my best trade in terms of real $$, it is a good shorting example.)
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