The first chart is the daily and the key take away here is that AMKR opened below its rising 200 day SMA. Initially, it tried to recover it but failed. The other thing I look at on the daily is if the 38% Fib. extension lines up with something technically meaningful. Here we had a PP (swing low) so it was picture perfect.
The second chart is the 15 minute with my entry and exit. At the point of entry, I had four volume bars and it was quite obvious that the bears had a show of strength. The second observation was the proximity of the down sloping 5 period ema which is important for timing the entry correctly. I do like the entry bar to close at or near its low and in this case I would have preferred if it had taken out the round number $11.50, but it was just a heart beat away.
The third chart is the 1 minute chart which I always watch closely after entry. I don't like getting stopped out, so if the trade starts out really badly, I can sometimes save a bit of money by either scratching or tightening the stop.
In the case of AMKR, we had the typical retest after the initial break. The key here is that it observed the 20 EMA as resistance on a closing basis. Once the trade got going, price never breached the down sloping 5 period ema on a closing basis. Each consolidation point was orderly and if you wanted to add shares to your already successful trade, the breaks of the consolidations points, marked by the blue line segments, were the best entry points.
15 comments:
It's too late to edit this post because it has already been picked up by Google Finance. But I wanted to mention that this is a Trader-X type setup. Also, AMKR was on the Briefing.com gapper list.
Many time I see some buy/sell large orders must higher/lower then bid/ask price. Then this create a long tail upper/lower. I don't know if they are real.
Is this the bad tick you talk about few days ago?
Have this ever cos your stop loss to activate?
Jerry,
That's correct, an out of the money order goes through and we see it on the chart but not on the level II screen. This is usually referred to as a bad tick but since it doesn't go through the regular channel, it doesn't affect the stop.
Hi Jamie,
Good trade !!!!
You mentioned that you lower your time frame to 1 minute after entry.
Do you always do that ?
Do you look at the 20 EMA as Support or Resistence ?
Thanks for your great charts and comment !!!!
Javier
Jamie,
Thanks for the 1 minute chart. I was able to get in on DWSN on the 1 minute which would also have worked nicely with the 5 and 15 minute. Entry 63.15. It's uncanny how an entry can sometimes be successful at more or less the exact price using the 1,5, & 15. Unfortunately it doesn't gel as often as I would like. As i harped on in a previous post the 1 minute has really worked for me. Crabel, X, now you. Exemplary tradition!, George
Hey Javier,
I always have three timeframes for the same stock on my screen at all times. I have noticed that the 20 ema holds as resistance on a closing basis on the 1 minute timeframe. When it doesn't hold a reversal is usually taking place. This was true for AMZN yesterday and BIIB on Monday.
One thing to note is that all three trades moved exceptionally quickly.
When I was trading from work, I only used the 15 minute timeframe, but now I trade from home and have access to more screens.
George,
Nice trade with DWSN!
Over the weekend I perused the Underground Trader site and noticed that they recommend gelling on three timeframes too. If I remember correctly, they use 1, 8 and 60 minutes.
Thanks Jamie.
So what are the 3 time frames you use for the same stock on your screen at all times ?
Thanx :)
Javier
Jamie,
You usually place your fib ext on the first 15min bar. But this trade was on second bar. What is special about this trade that made you place fib ext differently? Thanks
Pat
Sorry about that Javier,
I use the 5 and 15 and I alternate between 1 and 3 on the third depending on liquidity. If the stock is not very liquid, I prefer 3 over 1.
If I like the setup on the 15 min. I also check the daily timeframe before entering the trade. Don't want enter a trade if I'm going to run into a wall S/R 10 or 20 cents away.
Pat,
Good point. The logic I used to make the decision to extend my Fibs from the second bar low is that price had already taken out the ORL and so it was no longer relevant. It's open for discussion. I'm not 100% sure if my logic is correct. But I set it up as a B&B of the second bar (hammer) low.
Jamie,
I'll check the underground trader site, thanks. Like so many others, I like to build a gapper list to sort out a potential trade. DWSN showed up on Kirk's pre-market morning list this morning. What I've found interesting on your site and is often poo-pooed by some traders I know is "that there aren't opportunities worth pursuing during the quiet lunch/early afternoon hours. Yet, I've found some of my best intraday entries in that quiet period. I've also read numerous trading books that strongly discourage trading the quiet periods. My 2 cents. I'm trying to peal as many of the biases/dogmas as possible. It's a never ending challenge! George
George,
I agree, if a gapper breaks out during lunch, that's when you have to trade it. Also, lunch time is a good time to review the watch list for developing patterns.
I had DWSN listed in my pre-market post as well.
Thanks Jamie. In other words, if price had already taken out the ORL, you will usually place the fib extension on the intraday swing low?
Pat
Pat,
Yes, but I'm still experimenting with this idea. Not sure it is entirely correct. I need a few more trades like this to see it the logic holds up.
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