Sunday, November 22, 2009

Friday's Trades - Research In Motion Limited (USA) (Public, NASDAQ:RIMM); Potash Corp./Saskatchewan (USA) (Public, NYSE:POT)

HCPG daily spot for MOS on Thursday night's newsletter was $55.00. Juxtapose the MOS 15 min. and the POT 15 minute timeframes and they are identical. So, if we can target trade MOS to the daily spot, we can also target trade POT to resistance of Wednesday's high. I'm not suggesting that you trade both, I'm just saying, if like me, you prefer POT, trade POT. Get your inspiration from the HCPG newsletter, borrow the setup from MOS and apply it to POT, or not. Either way, both trades are winners.

The trade is executed on 1 minute. Price forms a handle at the base, breaks out for a gap fill, consolidates and extends to the target.

RIMM was an ambush setup on the daily. RIMM turtle souped (printed a lower low on initial test of support of the PDL and reversed). It chopped around and eventually carved out a tradeable triangle on the 1 minute timeframe. After the BO it moved quickly to close the gap, consolidated and rallied up to PDH.

More consolidation in the upper half of the day's range led to a second entry.

Friday's market action was narrow range and choppy, but also on the bearish side, so that tells us that we don't want to over stay our long positions. Target trade and get out.

N.B. Turtle Soup refers to a Linda Raschke trade setup I read about in this month's Active Trader magazine.


SQL_Student said...

Is there a reason that your entries were based on the 1 min charts? particularly in case of RIMM where 5min frame also provided a good entry as price inched above 8MA and morning's high. Why did you prefer the 1 min chart, doesn't this time frame has more noise. thanks

Jamie said...


For highly liquid stocks such as RIMM and POT, the lower timeframe has more tells. For illiquid stocks, it doesn't work, because as you note, it ends up being just a lot of noise.

Steveo said...

Ok, I am going to do a little victory lap here.....

Black Swans do not drift in, they are delivered by a cruise missile in the middle of the night, holidays, or on the weekend.

As America tryptophans out and wakes up weary tomorrow, with half a trading day to "panic out with", this could be very interesting. Looks like nearly "perfect timing" by our financial overlords. Lots of Turkeys (aka Lemmings) getting cooked today.

PDT said...

Where have all the blogs gone? I've just started back up trading again I'm shocked to see that most of my favorites bloggers are no longer active. Anyone have any good suggestion out there?

Steveo said...

PDT, Sign of a the other 100 signs of a top. It is silly to keep up a "full court press" on trading analysis when the market will do what it does. It is silly to be long anything, only the greater fool theory could support a long, and the lemmings are close to the edge already. Here is my favorite blog, hehehe.