In conjunction to taking a look at the index charts, I'll also take a look at the $VIX. To me, its clearly forming a bullish wedge and today's move just solidifies that opinion. (I had drawn in the wedge shape over the weekend).
1260 will be a very important level for the S&Ps to hold.
Here's a 30 day x 15 minute view of the Russell 2000 ETF, the IWM.
This chart shows the Median line failure on the IWM. I traded it as a long with the TWM.
Here's the 30 day view of RIMM x 15 minute bars. You'll see the fairly nice channel it's formed over that time period. Once I have a well defined channel, one of the things I like to pay attention to is how it responds to movements with in the channel.
The blue circles are a good illustration of that. While to the blind eye or those charts that aren't using channels, RIMM may have appeared to be treading sideways in a range between 125-135. Taking a closer look at the chart it shows how RIMM fails at each subsequent channel line (first the outer upper limit or the 100% line, then the 75% and 50%).
You'll also notice that when RIMM breaks the downtrend line I have starting at 135 from the peak on August 11th through the peak on August 15th, that it fails to even challenge the recent highs of 135 and instead pauses at 134. There's also a bit of negative divergence there (not highlighted on the chart).
** Side note: has anyone else noticed my overshoot theory (with other technical patterns, etc)?
So now taking all that information above, I throw even more details at you :) I apologize if this seems a little crazy, but in sake of time constraints I've used the same chart to illustrate how you can follow one stock that can setup again and again. Being familiar with how a stock trades, and what support / resistance levels it may respect definitely help.
My only real regret is not letting todays trade run a bit more, or taking a partial and letting the rest run.
It's been a while since I've posted. I think this is just about the longest I've had in between posts. Part of it is that I don't want to put up posts just to have something posted. I'd like to have some real value behind the content, which could actually serve as an example and demonstrate something useful.
Posting will probably remain a bit slow until the Olympics are over. I'm also trying to get more reading done (both medical and trading related).
Anyhow, here's a channel breakdown example on Apple.
We'll start by taking a look at the daily chart.
Here's a 20 day view of apple with 15 minute bars. Notice how there's a trend acceleration (light blue channel) inside a primary trend or channel (purple channel). From my previous posts on channels, you'll notice how the channel lines tend to serve as support/resistance.
Finally, here's a 5-6 day view of that same chart. I've zoomed in to try and identify what I was seeing take place over the last week or so before I took a short entry.
Most of the annotations are on the chart and I hope it didn't get too cluttered. I wanted to try and point out as many things as possible as I felt there was quite a bit going on.
I think AAPL can put in a bit more downside here, and I may be looking to reshort on a low volume pull back higher.
Here are 2 failed trades in Mastercard & Visa. Both really looked like they wanted to break down and acted like they were consolidating for that break down so I setup my orders to get short. Buyers then stepped in after the break down and after tightening stops on both of them I got stopped out. Funny thing is, if I hadn't tightened my stops and just let the positions run, they would have closed out a bit to the plus side as they closed near the lows of the day.
Ah well :)
I probably should have just taken V short as it looked more bearish and less oversold on the daily chart. In addition, V's volume for the day was more bearish than MA.
Fairly tired today. Excuse the lack of annotations.
CF was on my short list from its daily chart. It's been one of the few Ag stocks that still hadn't broken down. Other Ag stocks gapped down and CF formed a bear flag of sorts right below the 5 EMA.
I exited before the fed announcement as I knew I wouldn't have time to watch it during the announcement and anything can happen on a fed announcement.
Fairly rigid daily schedule (M-F), which involves being productive as much of the time as possible.
(All times are PST.)
5:25-30 AM: Wake up. Begin reading through the days headlines, while listening to CNBC in the background. Sort gapper lists.
6:15 AM: Heat some breakfast + Tea.
6:30 AM: Market opens. Look for base & break trades, watch list triggers, scan through intraday and daily charts.
At some point between then at 8:15 AM get dressed and be ready to leave for work.
8:15 AM: leave for work.
8:30 AM: arrive @ work, briefly check on any open positions
8:30 AM - 12 noon: Clinic patients. It's ok to sneak in a few quotes, trades &/or order adjustments in between patients :)
12 noon - 1 PM: Usually entails driving back home to watch the market close and grabbing something for lunch.
1PM to 5-7 PM: More work. Usually involves following hospital patients.
(Then depending on what time I'm out of the hospital, I try and run one-two errand/chore type thing every day: Grocery shopping, dishes, laundry, cleaning up, pay bills, etc.)
7:30-8:30 PM: Gym, Shower.
8:30-9:15 PM: Fix and eat dinner.
9:15-11:30 PM: Usually a combination of making phone calls, checking up on what happened to the markets during the day, reviewing the intraday and daily charts for the indices, visiting a few sites on the blogroll and finally looking through about 200-300 charts for any setups that jump out at me.
11:30 PM: Sleep. :)
Oil, which has been one of the strongest trades and strongest markets over the last several months has recently pulled back pretty sharply. There was no news to suggest that this pullback was due to some major psychology shift in the market. As a result I was waiting for oil to setup as a bounce play in the highlighted yellow area.
I'm not one to pick bottoms, but IMO this was a very low risk setup based on the strength we had seen in crude, the fairly rapid (yet losing momentum) decline we had seen).
Ended up making a fairly nice profit, which probably would have been better if the oil market wasn't as volatile.
2 Charts show the setup on the daily and the trade on the intraday basis.
Here's RBN from when I entered it as it was breaking back above resistance. RBN was a stock I had been stalking as it had held up better than most other equity charts during the month of July. It initially broke out past resistance but ended up pulling back with the market.
(*edit*: oops, posted the wrong RBN chart - from a few weeks back ... it's now corrected).
Here's the trade on an intraday basis.
Here's RIMM which ended up forming a symmetrical triangle of sorts. I probably exited a bit early, but looking back and thanks to the nondirectional market, my exit was actually fairly good. My target initially was a run up to the 50 day moving average (~126), but it had already run half that distance (from 119) in a very short period of time so I decided to take profits.
My entry in USO on Tuesday was around 98.50. I exited some on Wednesday @ 99.50ish (Tuesday's afternoon high), some on Thursday morning in Premarket around 102, and I tried to let the rest run but was stopped out below 99.80.
I picked up RBN @ Tuesday's close around 50.85, closed 1/2 just below Wednesday's Pivot R2 (below 52.07), and tried to let the rest run but was stopped out below 51.20 just before Thursday's close.
On Thursday I picked up RIMM @ 119 and probably closed it a bit too soon @ 122.50. Oh well :)
As for QLD (ultra long Qs), I've been nibbling at a small position as we are in the process of forming a rounded bottom on the Q's. I'm looking to add to it on a solid close / backtest of 75.
Despite only spending about 2 hours of total market time in front of the trading desk a day (thanks to being on the West Coast), I've had a pretty solid July. It looks like all my planning and keeping positions on a tight leash during this month have worked out well. 1 Month doesn't mean much in the long run, butif this is any indication of trading while working, I'm definitely happy with it.
This weekend, I'll try and put together a bit about my daily schedule and what has worked for me during what has been a fairly crazy July. In essence, it comes down to taking fewer positions, keeping them on a tight leash and staying disciplined about the trades obviously and maybe just as important the daily routine.
I'll also be sure to post charts of my entries / exits so its a bit easier to visualize.
That's all the time I have for now.
Good luck out there.