The first chart is the 5 min. open of QQQQs. The distance between the price and the down sloping 5 period ema is extremely wide. The first 5 min. stick closes on its highs, so I'm going long with a partial gap fill target of $44.50 (middle blue line).
I took a partial when price couldn't close above 5 ema and carved out a bearish star with long upper shadow. Moved stop to BE and exited when price approached the target on the next upswing.
I was hoping AAPL would rally ahead of earnings. Long on break of 2 inside bars. Move stop to BE after partial. AAPL carved out a tweezer top reversal at pivot high, followed by a bearish looking inside bar so I tightened the stop.
12 comments:
Jamie,
Iwas thinking of shorting some etf's after looking at Briefing's gap dns list but thought chart up SIGM and wait for a reversal since it was one of Fri's +movers. It did and so did all the banking/broker/mort stocks, so 90% of the stocks reversed to some degree. I was so in awe lost my sigm focus. Lesson: in a big dn/up gap mkt pick a previous winner, looser, or 4, etf, group, WL and see what happens. 1" charts worked well at the open. And look at spt/rst. And KISS.
Jamie,
I was looking to fade the gap too, but I was unable to find any low risk entry and the rally was quite a v-shape one I would say.
On QQQQ, what made you decide to fade the gap? Entry based on only first one bar sounds a little aggressive to me, would you consider that low risk entry? What was your initial stop? And after moving it to b/e, did you adjust it again?
I suppose your final target is 20EMA on 5min chart?
Thanks,
YR
Jamie,
2 more charts for you, if you would be so kind to take a look.
OIH: Would you consider a break of 8/5 and 9/5 a good entry today?
ABK: break of $7.4 (high of 2/5 and 3/5). There is a PP at about 6.94
Thank,
YR
You are incredible,wish one day i will be like you.i am trying,learning every day .nice trade wsw.
Was that really a "dummy" entry per the chairman's dummy criteria? He usually waits for a low-risk entry point in a consolidation (NR7 or Inside Bar) before entering. Clearly what you did worked, but trading the opening bar seems more risky than it's worth.
(Not busting yer chops, just looking for insight)
Okay guys, I stand corrected, the Qs trade isn't a dummy entry, it's a V bottom capitulation play, and those are not generally considered low risk.
My stop was 2 cents below the first 5 min. bar.
This is the type of play described by Vadym Graifer in Techniques in Tape Reading. I used to do a lot more of these, but since becoming a dummy disciple, I shied away from them. The win:loss ratio is not near as favorable as the dummy entries. However, when opportunity knocks (.75 basis pt. rate cut), sometimes I can't resist. :)
BL,
SIGM yesterday similar to CREE which I decided not to trade despite inside bar 3/15 because it was too close to a gap fill.
Got in CREE this am on 1 min. as per your recommendation.
Hi Jamie~
For folks (like me) that do not have the experience or knowledge for a great variety of setups (like you do), would you say that dummy trades are safer/more effective if they go in the direction of the gap? For dummy trades, do you have rules for trading only in the direction of the gap?
Thanks in advance!
anarco
Anarco,
I agree with your first statement. I do not limit myself to trading in the direction of the gap for dummy entries. If you do a search in the nav bar of this blog for "gap fade", you'll find a few good examples of dummy fades. The key is usually to look for a strong candlestick reversal pattern and then wait for your dummy stick after price crosses back above MA.
I looked at your "gap fade" trades and explanations and they are great.I will keep an eye on these plays.
BTW: I am slowly starting to incorporate intraday PP into my trading. Thanks!
YR,
OIH break of 8/5 - price retraced 50% of morning swing high and your entry is good but I would wait until price crosses $156. Hope you traded it today as well!
ABK - No, same reason I didn't take CREE break of 3/15 yesterday - moved too far leading into that setup and so I would need to see more consolidation. Here again big move today. Hope you were there!
YR,
On the QQQQ trade I didn't move my stop. This is a slightly different type of trade so I left it a BE after taking a partial.
The basic motivation for the trade was the fed rate cut. The distance between price and 5 ema was so wide that I felt a big move was coming because price and ma always find each other. As we can see from the chart, they met about half way between those two blue lines.
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