Institutional buying was at work today (MNST selling). I noticed some buying in INTC in pre-market and decided to see if it was worth persuing. Yes indeed. SNDK also had a nice move and LRCX finally decided to join in as well. Semis were hot.MNST was flashing red on my Trade_Ideas scanner all day. It finally paused to consolidate the morning losses and set up another dummy B&B entry.
I also traded a Gapper - FCSX and quickly decided I don't like this stock - the spread is extremely wide and when I was stopped out, a dollar profit turned into little more than half a pt. with slippage.
4 comments:
Jamie,
Where do you see an entry for (RIO) for today?
There were Upper Shadows on all 5,10,15mins chart between 11:20 to 11:30. Plus I didn't see any significant signal from the Volume during that period.
How would you handle the entry and why?
Thanks!
Hi CDT,
On the five minute timeframe, you could have entered on the 11:05 bar as price took out the high of the 10:15 candle. On a B&B setup like this, you want to see a dip in volume just before it pops. On the five min. volume dipped at 11:00.
RIO had strong volume all day, so it's harder to see the dips and spikes.
The other alternative is to trade it as a traditional Trader-X entry on the break of the 15 min. ORH. Instead of using the 15 min. timeframe to set your stop which would be quite wide, use the 5 min.
Jamie - What are you guidelines on the placement of your S/R lines? I noticed on your LRCX trade you placed the R line on the candle wick as opposed to the real body. Had you used the real body you might have entered on the 17th bar but been shaken out by the 18th bar. As always your input is greatly appreciated.
Hi Joe,
The LRCX trade was a pivot point setup. The upper shadow marks a PP which has been in play for a long time. It acted as support on June 20th and 21st and as resistance on July 2 and 10th. My rule is to place my buy (sell) order two ticks above (below) the PP. I use two ticks because I want to make sure the bid takes out the PP and not just someone hitting the ask.
During lunch I noticed that LRCX had recaptured the ORH and was trading in a NR at $52.50 so I set my buy stop order at $52.67, two pennies above the July 2/10th PP.
I've received several requests to go over pivot points in more detail, so I will do a post on this topic over the weekend. PPs are strong S/R points, but when they are broken, they usually set off vertical momo moves as you can see from the LRCX trade.
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