Wednesday, December 20, 2006

Dummy Trade of the Day - MasterCard Incorporated (Public, NYSE:MA)

MA pulled back to support (blue line) and the rising 10 period EMA in an orderly fashion in early trade. I entered long just as price was approaching $97.00. MA rallied hard from $97 to $99.00 in less than 30 minutes. Once price was firmly above $99.00, I moved my stop to $99.00 to protect my profits. I was stopped out shortly thereafter. My second entry was a low risk dummy entry as price lifted from support of the 10 period EMA following a NRB midday. I was well aware of the negative divergence of the RSI on the 5 minute timeframe and decided to take my profit at $99.00 as I was fully expecting a lower high. That's exactly how it played out and I was happy with my decision. These were my only trades today.

8 comments:

Anonymous said...

Hey jamie.
I think i might have sold you some of my shares on your first trade today in MA since i held a position in MA from the day before. I was really hoping to see a morning pop but it just kinda sat there and i got impatient and sold a portion of it. Good job on the trade. I sold the remaining shares at the double top on the 5 minute chart cause the negative divergences. I am in RVBD pretty heavy. RVBD was a fun trade today. It had a classic trend day on the 5 minute chart and just kept buying the pullbacks to the 20 period moving average. I am gonna excercise some more patience with this one and hopefully i'll be rewarded. NIce job on the MA trade.

Basim.

Jamie said...

Nice work with RVBD Basim! It showed up on my gapper scan today but I was too busy with MA. RVBD was a flat base breakout - very powerful.

Simply Options Trader said...

Jamie,
Fine execution on your MA trades. Great job! Thanks for your sharing and educating.

Wishing you a merry x'mas and great 2007!

Jamie said...

Thanks Simply Options Trader! Happy Holidays and all the best for a very profitable new year.

David said...

Need some help selling a Jan 07 of MA call option when do you think would have the best price? Thanks in advance.

Jamie said...

Hi David,

If MA can't hold support at $94.00, it may form a double bottom and bounce off of the rising 50 SMA on the daily timeframe. I don't know how long that will take or how robust the bounce will be so I can't say when would be the best time to sell.

Good luck.

Anonymous said...

check out GOOG. looks very interesting here. i wish i caught it earlier. I just stumbled on this setup in the after hours. GOOG is testing the Oct. gap support and there are undeniable positive divergences on the 60 minute RSI and MACD coupled with a falling wedge. Could be a winner tmrw.

Basim.

Jamie said...

Thanks Basim,

I'm cautious on GOOG. It's not as obvious as the MA setup earlier this week. I don't trade GOOG because it's out of my price range. But I will watch it tomorrow. One of the things I don't like is the odd looking H&S top like formation on the daily chart. I know that the right shoulder is ill formed but it could be a red flag.