ACOR from the Briefing.com gapper list had a wide opening gap and took out its all time high on 2/15. The third bar carves out a bearish tweezer top reversal and price comes back into the rising 5 period ema. It holds the 5 ema on a closing basis and starts to consolidate sideways, eventually forming a flat base. Throughout the consolidation, the lower shadows form a series of higher lows. As price becomes increasingly narrow, ACOR prints 2 NRIBs (NR7) and I go long on the break of the blue line. It started out beautifully with a WRB that closed near its high (critical success factor) and then it died. It was a nail biter until it finally took out, and closed above my entry bar. Exit as price approaches morning swing high.
11 comments:
ACOR came within $0.01 and $0.04 of potential tight stop levels... this is a contributor to heart disease!
LOL,
I placed my stop 2 pennies below outside bar, so I think I was 4 cents.
Jamie,
Always enjoy your posts. How do you scan for NR7?
Thanks.
Hi Jamie~
Glad this one worked for you! My Pivot Point trade failed miserably today :-(
Anyway, considering the amount of economic market data that is to be released this week, the Fed, earnings, etc., what do you do? Do you trade less? Are you more selective? Are there days when you do not trade at all?
Any advice on this area would be great.
Thanks,
anarco
Hey Alex,
Nice to hear from you. I use Trade-Ideas to scan for NR7 in the WL and Gapper lists, but my gapper list today was short, so I just eyeballed this one. A quick check of TI scans and it did, in fact, flag the NR7 exactly where I traded it.
Anarco,
This week could be choppy and narrow leading into the FED policy statement on Wednesday. I like to stick to very low risk setups in an uncertain trading environment. I usually trade everyday. The only day I might consider not trading is OPEX.
RE: your BAX PP trade. PP trades have to be executed as close as possible to the actual PP. Bars 3-6 were NRIBs at base of PP. Short break of 6/5.
It is really good to know about trading the PPs as close as possible to the PP lines. If I would have traded BAX the way you suggested (break of 6/5) and closer to the PP, I would have had time to exit after 12/5 at break even (small profit).
Thanks for your advise!
Jmaie...
I use esignal as well for Pivots, but I show ACOR had a PP of $22.06. How do you get $26.057 as the PP?
Mike
Mike,
You're right re: esignal PPs. When stocks gap wide like this, Esignal PPs are left in the dust, so I use the high from the daily chart to mark the daily pivot on my chart. This gives me an area of support/resistance to focus on.
Ok, now I understand, however, do you use the the most recent highs or the 52 week high? I assume you juggle these two depending on context and the magnitude of the gap?
Mike,
For stocks tesing all time highs, I generally look at most recent highs. For stocks coming out of a downtrend, I'm looking at former support areas, conjestion areas, recent reaction highs, and pivot points. A good example of the latter is my RMBS trade on Jan. 30th.
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