Thursday, September 18, 2008

Capitulation Day Trades - Morgan Stanley (Public , NYSE:MS); Barrick Gold Corporation (USA) (Public, NYSE:ABX)

Morgan Stanley (MS) was the big news story today and it set up the perfect round trip trading. I knew it had capitulated but the long entry just flew past me. I guess I was drowning in euphoria over the short trades. Anyway, the 1 minute chart details the short entries. I'm now using the 10 period EMA (pink line) on the 1 minute time frame as opposed to the 5 ema. The 10 ema acts as support/resistance on the fast thrusts/swoons better than the 5 for this timeframe only. Still use 5 for longer timeframes.

My beloved ABX, setup a follow on trade after yesterday's strength. But just as the broader markets gained some real strength, ABX fell off a cliff. Sweet ride out of a bear flag. The last trade was a gut feeling, but I felt I could afford this stupid indulgence after such a profitable session.

4 comments:

Tyler said...

Jamie,

Great trades today. I was hoping to see some great profits on your blog today.

Also, thanks for the compliment about my trades. Unfortunately, I think you may have looked at my charts before I posted my analysis. They were only paper trades because I am still experimenting with my scan and I think it is getting better. It seems to give me some fairly good candidates each day.

I will let you know how it goes.

Thanks,
Tyler

Jamie said...

Thanks Tyler,

In order to get a good feel for the market, one must trade under all kinds of market conditions. The current levels of volatility are extreme so I agree that new traders are best off trading lite or paper trading in order to observe and learn.

Anonymous said...

Jamie,

Congrats! What a day - you and me. I traded GS mid-day and ESRX late. The volatility was incredible.

Do you still have FWLT on your WL? 42.50 is a good level for a pop to 45.

Jamie said...

Awesome Jim!

FWLT still on the WL and I will set the alert. ESRX, disappeared from the WL by error, glad you mentioned it, so I can add it back.