Dow Intraday Charts 26 Jul - 30 Jul

[carlosd]

Hi CM.

I've had a nightmare day.

I went long on pull back to 100 ema @ 1.15 est, with low rsi, only to watch it freefall and hit my stop for another -20 about 10 minutes after i entered the trade.
LOL.

BTW I've been following (lurking) your thread for a while and just want to say what a great job you do, I think I've learnt more here (obviously not enough), than any TA book.

Cheers

Carlos

 

[carlosd]

Hi carlosd

Took the parachute option and bailed out..and to rub the salt into wound, i missed short entry at 13:18, was having teeth pulled out, now its my hair.........

Looking at the price now I wish I'd held on.

I went long thinking it was a pull back at 1:18.
But then I am new at this so what do I know.


Carlos.

 

[justyn]

I've finally managed to have a good day today!

It was difficult early on, it seemed very choppy, but I managed +10 points then another +14.

I took CMs advice that it was probably a bad day to trade and went out for a bite to eat.

Got home and the price had dropped to 090. I noticed a flag had formed at 19:30 and the RSI was heading up while the price went down.

When the flag broke I went long and at about 20:15 saw three peaks on the RSI pointing down so decided to get out for +30 points. I decided that was enough for one day. Saw the price jump to 064, I thought it might do this but decided to play it safe and take the points. Looking at the chart you would have to be right on the button to chip out near to 64 before it dropped again.

Can't believe I have managed to make 54 points in a day and get 3 trades out of three correct.

Justyn.

 

[smarwood]

Hi All

Managed to redeem myself after 2 bad starts... for 5 point prof :|

better than a loss tho....

have attached my chart indicating entries and exits for comment from the masters on here.

Have a good night all

Spencer.

 

[hammer]

HI guys,

Good to see loads of comments and participation. Choppy day thats for sure. Only placed 3 trades today, first was great and perfectly executed - good entry time and target met. Second trade was a short at about 10144 which had a close stop which was triggered right before the drop down to 9985! The third and final one was a long, prob a bit late but got in on the uptrend at 10136, watched it climb to 10157 then just drop to trigger my stop again at a loss. Cant believe i went from 20 points up to 10 points down within minutes and no real indication of a reversal! So my question is, can anyone explain the sudden drop near the end, maybe i missed something?

Thanks
Hammer :cheesy:

 

[ChartMan]

Well done Justyn!!! 54 is good for today.!
For the rest of you, and Justyn, who got lucky, after a big rise on the Dow EXPECT a choppy next day. You really have to do your homework to get anything out of these and the secret is to not get drawn into anything that 'just takes your fancy' . Best to get to the end of lunchtime ( 6- 7pm) and take a good look at te day's action. Then make a plan on where you could take a trade or two.. I already gave the two limits of where to start today- 10 and 50. As it turned out,taking trades at those points would not have been too good, but the tops and bottoms that followed would have been good entries. So remember, don't get sucked in on a whipsaw day.- That's a day following a strong move. ( consolidation day).It doesn't always happen, but you need to know that it's quite usual. You could easily end up blowing all that you made the day before.
Hammer Couple of things- we already had two tops at 60 so the third one would either go straight through ( with maybe a small pullback, ) or it would drop off. Secondly, beware any near vertical rises or drops. I call them "V" tops or bottoms. They usually show as bottoms.... but they nearly always recover to " where they were" quite quickly. These are usually attributed to "news spikes" and produce a knee jerk reaction, hence the quick recovery. If you want to see a classic example , check out the day when there was a light plane crash into an Italian building and the market thought it was another mini 911. You'll need to match that date with my archive files for the Dow that day.
This leads me onto the way to deal with that IF you get caught ( and plenty do as it comes without warning). IF you are on the right side, exit at the first sign of a reversal. You will usually see a significant spike on the high or low, and a close well of those peaks.Volume will be a huge peak too. That's your exit.
IF you are on the wrong side, it's best to sit it out and start praying that it follows the norm, i.e. it recovers quite quickly. If in doubt, off load half, if you can. there's no point in closing for a big loss, only to see the price go back to where it was.
This is something you need to research and decide on WHAT your strategy will be. You will NOT have time to think about it when it happens, because if you are on the wrong side, you will be paralysed by fear!!!! Trust Me on this.

 

[hampy]

Great to see all the new peeps having the confidence to post trades, good and bad. It can only help everyone in the long term. With the renewed interest maybe we could resurrect the chatroom in the not too distant future?

 

[ChartMan]

Great to see all the new peeps having the confidence to post trades, good and bad. It can only help everyone in the long term. With the renewed interest maybe we could resurrect the chatroom in the not too distant future?

If I shout really loud,you could probably hear me from Farnborough!! :cheesy:

Here's a quick example I found of the "V" drop. I don't know if it fully recovered, as it was a chart showing a "blow off bottom" on volume as a long entry. It was for the ES but I don't have a date or prices, sorry.

 

[Bill]

Nice post Smarwood.

On the subject of chatroom [Hampys post] it seems there may be some interest. Would anyone be interested in setting a particular day next week for the T2W Dow strat self-help society. If we could agree on a day it would ensure participation? Just an idea....

Bill

PS No fish allowed! [I wonder if anyone knows what I'm taking about?]

 

[ChartMan]

Sitting mid channel, with room to go either way. Would be nice to close on164 tomorrow. :cheesy:

 

[ChartMan]

on that triangle- NOTE the slope change as the price goes from 20 to 34. You have just got enough time to get a long in before it breaks. If you're on SB, and take one of the down ticks, you might steal a few extra points as the bias goes to the low side.....If it goes wrong, wait for an uptick to close as the bias will be to the upside....For this trade, the near support is 20 and that should be your stop trigger. Notice also how it failed to get up to 65.That should start you thinking about closing..... It may make it later, it might not. If the move is going to be strong, you will always make target quickly and quite often, you will find "dual targets" that either co -incide or are near to each other.These may well be a triangle plus a flag that follows- as yesterday.That triangle had a pause at 50 and that pause ( mini bull flag if you want) gives a "dual target" of 65 as well. This is confirmation that your target calcs are correct.It is also confirmation that if the price follows through, there is a strong move coming.......The converse is true.
Easy trade of the day, for the patient ones, going long off the PD at 90 for +70.You should have spotted the ND and triple top at 160 for an out....

 

[justyn]

Smarwood

here is my view on what happened at your "Exit 3" - I am no expert but thought you might like to know how I saw things happening for comparison...

At my point 1 I saw a flag develop with the price sloping down and RSI sloping up and went long as the flag broke.

I thought the price would reach 064 but at point 2 I saw 3 peaks in the RSI pointing down so decided to get out. The price then did touch 064, all be it briefly.

Hope this is useful to give you another view point - even if it is from a newbie!

Justyn.

 

[ChartMan]

How to nail that top at 160....

ES + Vol is a great addition to your tool box. Look at the volumes. The second big spike just cannot push the price up. Where else can it go but down? It has to be all the longs closing/ short entries....

 

[ChartMan]

Justyn I hope youcan see why your exit was wrong.... the down slope in RSI was a "normal" retrace and NOT divergence.
Check the last rise in RSI from 65 to 80. The price went from 20 to 40. Ratio is 1.33 to 1. Now look at the down channel and RSI. RSI went from 80 to 60, and the price went from 40 to 30. Ratio is 0.5 to 1.There is a big difference inthe UP strength to the DOWN strength. This is NOT a place to close a long. It's not foolproof, just another check you can do tosee "what the action is".
As a guide, a ration of 0.5 to 1 is weak in EITHER direction. > 1:1 is strong in either direction.The best use is when there is a significant difference between them.

 

[smarwood]

Hi Justyn

I used to trade only the swing trades between Pd's and Nd's (gamble trades) but look what happened yesterday at 15:01 for eg. i predicted the 3 pk ND top, if i had reversed my trade there, it carried on moving up, and took out the stoploss. nothings a cert in this game as i too have jumped in trades with both feet, only to get my fingers burnt.

not as easy as it looks, harry hindsight is a wonderful thing though.. : )

good luck

Spencer

 

[ChartMan]

Why don't we kick off the Dow strategy self help society on Monday? Work permitting, I can get the ball rolling around 1pm with a review of this week's action, with likely SR levels, what to beware of and what to look out for.Please do your homework and study the 10min chart over the weekend so we're all talking off the same page. I would then be able to pop in at 5:30 ish and see how you're all doing and maybe put forward my thoughts and an update.

 

[smarwood]

Thanks CM

count me in (after all it was my idea to re-start the chatroom) so if it all falls apart, i'll take the blame too......


Spencer

 

[bansir]

ok on the triangle breakout folks but....

1. which way was it going to go?
and
2. you didn't even know it was a triangle until after two and a half hours from the open so a good test of patience?

there was a couple of clues, like the higher lows towards the apex etc..
Interesting thing though, I'm kind of hooked on these mini pd bottoms which last only 4 to 9 mins or so and blow me if there wasn't one right before the breakout-see the little red lines on the attachement. Anybody else using these or are they just in my imagination?

'course being sceptical and cautious, I waited for the pullback entry where there were precious few points left and targets failed... ah well, love it

Cheers,
neil

 

[Quercus]

Might see you in there CM, and see how it goes!?
I'm back to trading YM since my ass has been whipped too many times by ES!
Cheers
Quercus Shorticus

 

[Bill]

Chartman re: chatroom- That's great I'll be there monday after work. Possibly 5:15ish. [Maybe I could also pop in earlier if the boss isn't watching! ]

Bill