VMW is a WL stock and was also highlighted on the HCPG newsletter last night. Despite the narrow gap, yesterday's wide range gives the Fib. extension a lot of potential.The key take aways on this setup are:
- yesterday's high holds as support (blue line);
- 8th bar is NR7 inside;
- 9th bar closes on its high setting up a mini base in very close proximity to 5 period ema;
- rounded bottom is very bullish - demand exceeds supply which means that each time sellers try to push price lower, they are met with more buyers.
I partialled out as price approached the Nov/Oct reaction swing highs as I thought it might hold as resistance ahead of the FED. I folded just under the 50% Fib. extension of the previous day low to the ORH. In retrospect, that last move was dumb because the $100.00 psych level was within reach.
My post fed trade was short the Qs. The market had already priced in a 50 basis pt. rate cut so the 25 was a big disappointment.
4 comments:
Jamie,
Damn, nice moves!! Simple Q short with all the disappointment and big surprise. Easy and automatic, maybe?
BL,
I was not planning to trade the FED because I thought they would give the market the whisper number, but when they didn't, it became an automtic short. Remember how the market reacted last summer when the FED surprised with 50 on an expectation of 25.
Jamie,
Nothing you ever do can be called dumb, in retrospect or otherwise. You are incredible!
Thanks Prospectus, I appreciate your vote of confidence.
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