Monday, July 13, 2009

Technical Picture - Financials Lead Advance

Minor upside on the open was quickly faded with weakness in energy/tech. However, continued strength in financials following the Whitney upgrade of GS from neutral to buy, helped push the markets higher. As noted previously, the markets were technically oversold and needed a catalyst for relief beyond consolidation. Today's strong finish puts us back above the neckline of the widely watched S&P head-and-shoulders pattern.

Big pressure on GS to deliver better than expected earnings/guidance tomorrow morning.

GS opened wide, retested support of 2 previous days' highs. It looked solid on a break of IB (not perfectly inside), but good enough.


bl said...

Nice trade. I ignored it even though I was up at 5 pst. I'll see if I can repeat that Tuesday am!

Tan said...

hi jamie,
How do u decide to place the fib on previous day range instead of ORH to previous day low? How do you decide where to partial and exit for GS?

Jamie said...

Good questions Tan,

I had placed all my fibs on my focus list stocks PDH/L the night before because that system was working perfectly the week before. But, normally, for gappers, we place fibs at ORH/L as you mentioned. I just didn't have time to change them.

I usually start locking in some profit after 3 wide range 15 min. bars, because from experience, we usually consolidate after a big move and I prefer to sell into strength. Manage balance of the trade to next fib level or reversal pattern/candlestick.