Afternoon,

March came in like a lamb and went out like a lion. Hopefully, things will began to calm down a bit (as far as the market is concerned).

The Russell 2000 opened around Friday’s close, sold off for a couple of bars and then screamed to the upside. In three 3 minute bars, the price broke a trend line and went up about 10 points. The price was above the 56 EMA, but using our heads here, a 10 point move need some type of a rest before continuing. So even though there was a trader’s trick set-up, I opted not to take that trade for that reason. The market then sold off with as much vigor as it went up. Again there was a trend line break to the down side followed by another trader’s trick set-up. The three bars proceeding the sell-off were again over 5 points and again I felt that the volatility was just too much. The first set-up that I felt was valid was after the market settled down a bit. There was a trend line break to the upside above the 56 EMA followed by a trader’s trick set-up. The trade was up .60 points, then down 1.80 points before making the objective. Here is the chart for the first part of the day and trade 1.

First Part Of The Day And Trade 1

Click on chart to enlarge.

(Read the rest of this post)

Afternoon,

Some days you are the windshield, some days you are the bug. Today… I was the bug. Well, I keep thinking that the market will start trending again…someday. But not today. By trending, I mean that the market will go more than a point before turning around and going the other direction. The direction of the market was down but with no conviction. All that being said, here is the update.

 The market opened basically flat and sold off. There was a trend line break below the 56 EMA followed by a trader’s trick set-up. The trade was up 1.40 points (just 1 tick below where we could move or stop to break even) before turning around and stopping out. In the next 6 bars, the market rallied 7 points with no set-up. The market then wallowed around before having another trend line break to the downside followed by another trader’s trick set-up. This trade was also stopped out for another 2 point set-up. Part of the reason that these trades did not work is that the Russell 2000 was in a 7 point range. I once knew a trader that would not trade unless the price took out yesterday’s high or low.  Here is the chart for trades 1 and 2.

Trade 1 and 2

(Read the rest of this post)

Afternoon,

Another volatile day at the office. We had another day where the Dow and the S & P 500 were relatively strong and the NAZ was very weak. This always causes cross currents that make it difficult to trade. The Russell 2000 gaped up today and proceeded to sell off for the first hour of the day.  The first trade of the day happened after a trend-line break to the downside followed by a trader’s trick set up. The trend line was drawn from the pivot around 12:45 pm CST yesterday afternoon. The trade was up 1.50 points and the stop was moved to break even. The trade broke even. Trade 2 was a trend line break followed by another trader’s trick set-up below the 56 EMA. Trade 3 was a trend line break to the upside followed by a perfect trader’s trick set-up. Notice how the price pulled back to the 56 and the trend line that it just broke before taking off to the upside. Print this set-up off and study it as it does not get any better than this. Here is the chart for trades 1, 2 and 3.

Trade 1, 2, and 3

Click on chart to enlarge.

(Read the rest of this post)