Tuesday, June 19, 2007

Intraday Pivot Point Trading - Riverbed Technology, Inc. (NASDAQ:RVBD)



Look for stocks that are trending up or down. For longs, when price carves out a NRB on PP support with convergence of 5/20 MAs, look for a low risk entry. If price stalls at the next PP level, start booking some profit and move stop to breakeven.

For shorts, looks for stocks that cannot close above the downsloping 20 MA and then find your NRB.

4 comments:

Tom T. said...

Jamie - this is very interesting - my first exposure to this type of trade - can you share more info on how to find uptrending stocks. Also, is there a way to better predict which ones will perform like RVBD - meaning besides candle action - is there some quality within an uptrending stock that makes for abetter candidate than the others? -Tom

Jamie said...

Tom,

To find uptrending stocks, I run a scan looking for stocks trading above all of the major MAs 10, 50, 200 on the daily timeframe. Within that group, I look for stocks that are attempting to break out of a base or as in the case with RVBD, have just successfully, broken higher.

My current watchlist includes names like ADSK, JCOM, IBM, SNDK, TBSI, TTEK, NVDA to the upside and AMZN, AMLN on the downside.

The basic point is to avoid stocks that are weaving in and out of the MAs which is common for stocks forming intermediate tops and bottoms. The market, has been weaving for three days straight, so good setups are generally hard to find.

Ideally, you need momentum which is generally found through higher relative volume or an ADX line that has a nice upward slope to it.

Prospectus said...

Thanks, Jamie, very informative. I assume you trade this off of either the 1,5, or 15 minute timeframe, depending on where the setup looks the best? Do NR7's mean as much on the 1 minute timeframe?

And the initial stop would be the other side of the NR7 candle?

Thanks!

Jamie said...

Prospectus,

I stick to the 15 minute timeframe for these PP trades. I sometimes look at the lower timeframes to see what's going on, but I execute and manage the trades from the 15 minute timeframe. All of the PPs are slotted in as they develop.

The longer the timeframe, the more meaningful the setup. I would not put too much emphasis on a single NR7 on the 1 minute timeframe, but if there are several back to back and in a straight line, it could be much more meaningful.

The initial stop is the previous bar high (low) depending on the direction of the trade and assuming an efficient entry point.