Monday, November 24, 2008

Gapper (Bull Flag) - Morgan Stanley (Public, NYSE:MS)

Sort the watch list on % change. The early leaders are financials and solar. I really liked the strong OR on MS. Price consolidated the gap in a narrow range. As you can see from the 1 minute chart below, the setup was quite similar to ABX on Friday. The Gap plus the early strength carves out a flag pole, the orderly consolidation prints a flag and that sets up the entry.

I took a partial at the 50% Fib. extension of the previous day low to the ORH (15 min.). After testing the $13.50 level, price printed a bearish shooting star and I folded.


Traded a couple of Canadian financial stocks in the retirement account. Both RY and TD setup C&H like patterns. Neither extended to the full 100% measured move, but they were orderly and easy to manage. I took a partial on RY when it stalled near the 5 DMA and exited the balance when price approached the round $ number. TD was very slow with no volume, so I was happy with 38%.

7 comments:

Tyler said...

Jamie,

Nice trades! I was looking forward to see what you did today and you never cease to amaze.

Are your accounts both at IB and linked? We trade as a corporation and have two linked accounts, but when I try to trade from eSignal when logged into IB as the master account it does not let me. So, I have to log into IB under different usernames for each account to trade. If you have any pointers I appreciate it because the eSignal people were no help.

Thanks,
Tyler

Jamie said...

Thanks Tyler,

The accounts are separate. One with IB $USD and one with my Canadian Broker $CAD. I don't want to trade US stocks in my retirement account because of wild swings in currencies can wipe out trading profits. The Canadian stocks I trade in my reitrement account also trade on U.S. markets for liquidity because the TSX is just like a midcap market with limited volume.

Even with extreme high speed, IB and Esignal are not always in sync. Esignal tends to be a second off on high volume days (maybe because I'm tracking too many stocks with too many lines), so I keep the brokers and platform separate on different dedicated computers. It is somewhat cumbersome, but entries and exits are better.

bl said...

Nice trades with MS. C news pushed the brokers. Dang GS.

Susan said...

Jamie,

Can you pls. take a take a look at today's (Nov. 25), Dow Index or DDM 15 min. chart. The 4th candle - would you treat it as a hanging man , though there was no uptrend on the chart when it formed.

Also, do you know of any good sites for studying Futures (for beginners). I have been reading investopedia.

Thanks,
Susan

Jamie said...

Susan,

Yes, that is a bona fide hanging man. They don't need to be at the very top, but part of a topping/consolidation type pattern is good. But unlike a hammer, hanging men need to be confirmed with either a close below the close of the hanging man's real body or when price takes out the lower shadow of the hanging man. The further down, the lower shadow, the following bar closes, the more beaish the setup.

In this case, the lower shadow is really long, so the stop is wide.

I don't recommend futures for beginners. Way too risky. It doesn't hurt to study futures to get a better understanding of trading, but mistakes in futures trading are extremely costly.

John F. Carter's book Mastering The Trade is good for both stocks and futures. See the link on my side panel. His web site TradetheMarkets.com has some good educational videos on futures trading. Move The Markets blog on my side panel also good. There's no lack of trading videos on You Tube. For futures try TradePilotPro.

That will keep you very busy, but don't forget to come back to Wall St. Warrior for all the rest! ;)

Susan said...

Jamie,

Thanks for the word of caution on future trading. I do not intend to trade futures but have been trading Index ETF's for the past few days. Just wanted to read about Futures.

Your blog have been more helpful to me than any other trading book/s. Thank you very very much for the time you put in the blog to share your knowledge.

Jamie said...

Susan,

Thanks for the kind words. Index ETFs are a good start before jumping into futures.