NKE was an earnings gap which I highlighted in last night's post and
pre-market. I see an inverted C&H pattern. The first three 15 min. bars constitute the cup and the rest is a wide handle. The head fake was the clue that
NKE was ready to go. Took a
partial when it started to retrace. After the first reversal bar came close to the stop, I decided to give it a little wiggle room and moved the stop back up above $59.00. I didn't want to get stopped out for 10-15 cents because I still believed it would complete the measured move which it did after tagging $59.00.
V was
gapping lower in
pre-market. Similar Gap & Go setup as my BA trade yesterday. Took a partial as price approached $79.00. Almost got stopped out on those weird price spikes midday. As soon as price recovered from that episode, I said goodbye.
My beloved
SOHU carved out a bear flag and executed perfectly. Tried to stay in as long as possible as I thought this one might close on its lows. But when it looked like it might want to retrace back up to the
declining 20 period EMA, I folded.
NKE was an earnings gap which I highlighted in last night's post and pre-market. I see an inverted C&H pattern. The first three 15 min. bars constitute the cup and the rest is a wide handle. The head fake was the clue that NKE was ready to go. Took a partial when it started to retrace. After the first reversal bar came close to the stop, I decided to give it a little wiggle room and moved the stop back up above $59.00. I didn't want to get stopped out for 10-15 cents because I still believed it would complete the measured move which it did after tagging $59.00.
V was gapping lower in pre-market. Similar Gap & Go setup as my BA trade yesterday. Took a partial as price approached $79.00. Almost got stopped out on those weird price spikes midday. As soon as price recovered from that episode, I said goodbye.
My beloved SOHU carved out a bear flag and executed perfectly. Tried to stay in as long as possible as I thought this one might close on its lows. But when it looked like it might want to retrace back up to the declining 20 period EMA, I folded.
28 comments:
Damn there is always so much to learn from your posts.
I too also traded NKE but off of the 12:30 bar low.
Can I ask why you wanted to buy on a break of $59.95 instead of the break of the low of the 1st and 3rd bar which was $59.92? Did you consider the base to be $60.00?
Also can you clarify this statement:
"After the first reversal bar came close to the stop, I decided to give it a little wiggle room and moved the stop back up above $59.00"
Where was this initial stop? Where you trailing your stops after each bar.
That's what I did and got stopped out at $58.91.
As always, thanks!
Hi, I was watching nke too. Can you explain a little bit what is " head fake"?
PDT,
Your entry is good,. Congrats! One way to preserve profits is to take a partial after three consecutive WRBs in your direction. After three WRBs, price is usually quite a distance from the declining 5 EMA. Since price and the ema are like magnets, they will eventually come together.
I had planned to enter on the break of the base, but the head fake changed my mind. I didn't want my stop to be too wide and I still had a chance to scratch if the base didn't break.
PDT,
Since I had already taken a partial, I didn't want to get stopped out on the second half so I removed the stop above the previous red bar and put it at $59.06 so that price could move back up to $59.00. I figured that would hold as resistance.
Ethan,
Price was basing along a narrow, straight line for a couple of hours and then all of a sudden it popped up. On the one min. chart it looks like a flag pole, but there's no flag, just a quick snap back. That is a head fake and it often results in a fast move in the opposite direction.
Head fakes can happen on a BO as well. That's why I look for the BO bar to close at, or near its lows.
jamie,
that gap & go is just casino stuff..can go either way
Casinos make money.
It's a new style I'm trying after seeing "How I DayTrade" has had tremendous success with it.
Also, seeing HCPG take these early setups as well.
The key is the fast move out of the base. If it stalls or makes a head fake, I'd like to think that I will be nimble enough to dump my shares before I hurt myself too much.
Good trades like usual. The conditions were great today. I had orders placed for the same two stocks, NKE and SOHU. I don't trust my broker (Scottrade) so I always use stop limit orders on entry so I unfortunately didn't get filled. I tried to play the break of the ORL on NKE as a base and break but it moved too fast. Next time I won't have the limit so close to my stop.
Those volume spikes on V could probably be attributed to lunchtime covering. Nobody wants to hold through lunch in New York, so I often see spikes up starting at 11:54 EST.
Thanks Rick,
I don't use limit orders often anymore unless the spread is wide.
Good to know about N.Y. lunch jitters. I'll keep an eye out for that in future.
Ok so the base is actually at $59.82 correct?
Like Rick I had a problem getting fully filled on my order. Do you just look at the spread (best bid/offer) or are you looking at L2 when you make the decision to use a stop-limit?
PDT,
Correct, the base and the ORL are $59.82.
Check your Broker settings for your stop orders. If you're using IB, the standard setting is that your order will get hit after 3 orders at your stop price. If you use a stop limit order, a fast move out of a base will pass you by. So, you can change the standard setting so that you get picked up after one or two orders and if you eliminate the limit part of your order, you will get filled.
I use L2 total view to monitor direction, spread, and depth of market. Like I said, I rarely use limit orders.
If I start looking at an unfamiliar name because I see a decent chart and the L2 has a wide spread, I move on to something else.
That's why I love trading the WL. All of today's trades are WL names, so I know what I'm dealing with.
"Check your Broker settings for your stop orders. If you're using IB, the standard setting is that your order will get hit after 3 orders at your stop price."
Wow, I am using IB and I had absolutely no idea about this.
Why would anyone want anything other than 1 time?
Just checked, can't seem to find that feature anywhere. Could you tell me under where you found that configuration.
Thanks again!
Exactly, you don't want to be the first to get stopped out and you don't want to be the sucker that buys the top. I changed my settings a long time ago. Very few problems with fills.
Select Configuration at top of screen. click on order, then order default.
Select your preferred order type and trigger method. Use default and then specify the offset.
Sorry Jamie I can still not seem to find that.
I am on the Order/Order Defaults screen. I have my Order type set to MKT, Trigger Method set to Default but can't seem to find what you are talking about.
There is a section on this screen called Default Order Offset Amounts. In this section they have Stop, Stop-Limit, Trailing and Relative. Is it in here?
Yes,
I thought your default order type was a stop order. If you're trading with market orders then you should always get a full fill. If not you constantly have to change the MARKET to something else.
If you decide to change your default order setting to STP, then you can fill in the offset for your stop.
Jamie,
Beautiful,
One nice thing about trading the brokers is TIGHT bid/ask. The oils, etc are all over the place.
Like the coals.
I cant believe people are so gulliable, you're too good to be true. You think youre making $3+ a day every day. Get real! I trade US stocks for a living and been doing so for the past 10years, very successfully and I'll tell ya, it aint as easy as you make it out to be. People please be wary as this guy is a fake.
anon.
Haven't you got a name ? ..lol.
Hey Anon,
You haven't dropped a load in quite some time. Constipation?
Anon,
When I first started reading Jamie's blog, I could produce maybe 25% of what he seemed to produce. At that time, I thought he was about 75% fake.
After much study and practice of the principles, I can now produce (in a full day of trading) maybe 70% of what he seems to produce. At this point, I think he is only 30% fake.
My goal is to continue learning and trading until I can produce 100-110% of Jamie's typical results. At that point, I hope to get a comment from Jamie saying that he believes 10% of my results are fake. If you are truly a full-time DAYtrader, you should have a similar goal.
Jim,
This guy has been an avid reader of my blog longer than you. Every time he goes through a rough patch, he slimes me. He's from across the pond and easy to identify from the time of the comment posting because he leaves his comments in the middle of the night when there's very little blog traffic. Always under the veil of anonymity because he's got no balls. And always bitter because he's a loser.
IMO, the height of arrogance is to think that just because you are suffering from trading losses, everyone else should too.
Maybe I'll stop posting my trades. I'm sure that will make him feel better.
I'm across the pond and trust me... I'm not anon. You will always be King. However, you may have read my recent post about 'proving' trades. I think if you posted your transactions (not your profit/loss) you'd see anon crawl back under his rock.
I have a ton of respect for you and your knowledge of the market and have no doubt all of your trades are real. However, I don't see any downside to posting transactions. I could understand if it took a long time, but it doesn't. I do agree with anon that you make trading look so easy :)
And I also have anon posters and it puzzles me why they don't come up with a creative name? I mean, it's not like I can track someone who calls themselves 'Assmunch'.
OONR7,
Thanks for the input. The Assmunch's (LOL) want live screen shots because they want to piggyback off of our trades.
Appreciate your thoughts about proving, but this blog is not about proving it's about learning. As far as proof is concerned, Jim (guest WSW blogger), Anarco, Trader MD... and countless others who send me emails have incorporated WSW setups into their trading with great success.
Elite Traders like Trader Mike, MaoXian, and Trader-X do not post transaction lists or P&Ls and I I'm not going there either. I'm not comparing myself to them, but I certainly aspire to reach their level one day. Anything that involves copying screens into MS paint is a pain in the butt for me. I sometimes lament that I am a slave to the blog, and I'm thinking of ways to reduce time spent on the blog.
Trading becomes easier when you have 2-3 well defined setups that produce results for you on a regular basis. Observing and understanding the underlying bull/bear tug of war that takes place on the lower timeframes has helped me immensely in timing my entries and exits.
Enjoy your vacation OO, but I get the feeling, that you're like me and won't be able to stay away from the trading screen for the entire trip.
lol... you're right, I will most likely find a way to trade as much as I can. But with the time difference it makes it difficult to enjoy the day and trade as well. I do need a break.
I respect your views regarding screenshots. For me... I like the verification aspect. I use a tool called Snagit and it literally takes seconds to do.
Long live the King.
Jamie,
Sorry that you're receiving such nasty comments, ignore them! This is a great blog and I understand the time & effort you've put in to educate readers like me. Thank you again!
Question on NKE trade. Why did you say the headfake was a clue that NKE was ready to go? Also why not choose to short on break of PP @ 59.82 (low of 1st & 3rd 15min bar)?
Thanks YR,
My original buy stop order for NKE was $59.82 but the head fake gave me the opportunity to enter earlier.
Also noticed a head fake on my DRYS trade today and initially price swooned off of it, but in the end it was a scratch.
Next time I trade a head fake, I will explain it in more detail. The best way to see it is on the lower time frame. It looks like a flagpole with no flag, just a quick U-turn.
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