RIMM was the big gapper trade on Friday. Unfortunately for me, it was also my birthday and that means a lot of phone calls from family and friends. The distractions caused me to miss the early break of the fourth bar - inside inverted hammer which turned out to be the trigger bar for the biggest move of the day. After taking out the ORH, RIMM retraced on declining volume and eventually set up the next B&B BO off of two NR7 type bars which ultimately only extended to the 25% Fib. extension of the previous day low to the ORH. I closed my position when it stalled there.Sunday, October 07, 2007
Dummy Gapper Trade of the Day - Research In Motion Limited (USA) (Public, NASDAQ:RIMM)
RIMM was the big gapper trade on Friday. Unfortunately for me, it was also my birthday and that means a lot of phone calls from family and friends. The distractions caused me to miss the early break of the fourth bar - inside inverted hammer which turned out to be the trigger bar for the biggest move of the day. After taking out the ORH, RIMM retraced on declining volume and eventually set up the next B&B BO off of two NR7 type bars which ultimately only extended to the 25% Fib. extension of the previous day low to the ORH. I closed my position when it stalled there.
Subscribe to:
Post Comments (Atom)
7 comments:
Happy belated Bday. Was looking at the same trade but didn't pull the trigger, didn't want to enter a trade with that wide a stop.
Thanks Bubs,
Jamie,
Happy Belated 22nd Birthday! :-)
May all the good and true setups appear on your monitor screens every single day; and the bad and fake setups never cross path of your eye-sight!
Now, let's talk business... '...break of 4th bar...' Hmmm, 1st, 3rd and 4th all painted a significant Upper Shadow. Plus, the 5eMA was rather far away. You've told me before that there's always a risk that a setup doesn't work out. In this case, I just want to know how would you grade this setup when the 5th bar was breaking the high of the 4th? (A letter grade would do!)
Thanks!
Thanks CDt,
The fourth bar is an inverted hammer so when the 5th bar takes out the high of the fourth I rate this one B. The only caveat at that point is the distance to the 5 ema which is still more than $1 below. Also confirms a mini C&H pattern on 1 minute chart on break of $110.
Inverted hammers are bullish when confirmed by a close above the real body.
Happy Belated Birthday to you! And wishing you continued success in your trading.
About this trade, you talked about inverted hammers being bullish when confirmed by a close above the real body. As you've entered on a break and not a close, IF that bar ended closing lower than the inverted hammer, would you have bailed out right away or keep to your initial stop?
YR
Thanks, Jamie! I didn't know the Inverted Hammer condition that you mentioned. Now I know. Thanks!
Thanks CDt
YR,
It depends on how it closed (color and type of bar) as well as volume. I was also monitoring it on 1 minute chart, so if I saw a failed pattern on lower timeframe I might bail.
Post a Comment