This is the Canadian chart for RIMM. It gapped down on the open and carved out two inside bars (3 & 4) with bearish upper shadows. However, the down sloping 5 period ema was too far away. The 5th bar was narrow, red, and closed on its lows, setting up a perfect dummy short. I took a partial as price bounced back up towards the 25% Fibonacci extension of the previous day high to the ORL. That bar closed as a perfect hammer followed by a NRIB so it was time for me to tighten my stop.Monday, January 21, 2008
Dummy Gapper Trade of the Day - Research In Motion Limited (Public, TSE:RIM)
This is the Canadian chart for RIMM. It gapped down on the open and carved out two inside bars (3 & 4) with bearish upper shadows. However, the down sloping 5 period ema was too far away. The 5th bar was narrow, red, and closed on its lows, setting up a perfect dummy short. I took a partial as price bounced back up towards the 25% Fibonacci extension of the previous day high to the ORL. That bar closed as a perfect hammer followed by a NRIB so it was time for me to tighten my stop.
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Jamie,
I posted a whole thing exit strategies on the blog. Would you be able to drop by and provide me your 2 cents Canadian (US fx is worthless). I'm really struggling to develop a simple yet consistent exit system. I continue to be a loyal reader and I really like your exits; both partials and full exits. Any help would be much much appreciated.
LP
LP,
Read your post on exit strategies. Great job and a lot of info to process. If I just narrow the focus on your 45% success rate for NRIB entry strategy, I can give you my opinion using a 15 min. time frame.
1. If the BO bar is not WR, it has significantly less chance of success.
2. If the BO is WR, I usually plan at least a partial exit at the next S/R level or 3 WRBs, which ever comes first.
3. Price and the 5 period ema are like magnets. If they stray too far apart, they will always come back together either through price or through time. So, I have no problem taking a partial when I see price move too far from the 5 ema. Obviously after 3 WRBs they are very far apart. And I don't like holding full size through the lunch time doldrums just waiting to get stopped out.
This is the exit strategy I employ for morning trades involving NR price/volume contraction leading to expansion.
I employ different exit strategies for different setups at different times of the trading day. For C&H patterns, my target is usually 100% Fib. extension from the low of the cup to the base of the handle depending on the time of day.
Anyway, more later. It's probably a good idea for me to document my exit strategies for each different type of setup I like to trade.
Edit pts. 1 and 2
If the BO bar closes near its lows, it has a better chance of success.
So you want a topping tail looking BO bar? a little confused. But I understand the method of madness. The problem is that bitch like needs to translate that into math and that might be the harder part.
LP,
Sorry for the confusion. I was referring to the RIMM chart in this post. Close near lows for a short and close near highs for a long.
As i mentioned I will post on this topic in both our blogs shortly with pictures of examples.
aaah ok...I was thinking long break out...sorry I'm staring at the US markets going to hell and I'm all discombobulated..
Anyway, I will look forward to the post.
do you ever lose money?
Blasphemy
Take those words back...we don't call him King Jamie for nothing...
If the LP's site is open to the public, could anyone post the URL?
Thanks.
Anarco,
LP's blog is by invitation. The URL is http://tradingaxiom.blogspot.com
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