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.

There are going to be some questions about the 2 circled trader’s trick set-ups in the following chart. I thought I would answer those questions before they were asked. Here is the chart for the potential trade set-ups.

Potential Trade Set-ups

Click on chart to enlarge.

The first circle was a trader’s trick set-up after a trend line break above the 56 EMA. Since the first trade had not been completed yet, this trade was not taken. I have recently been asked the question do I take a second trade entry if I am already in a trade. My personal preference is that I do not. If you watch the markets long enough, you may decide that it is OK to take a second trade entry (add another contract). The next circle on the chart was another trader’s trick set-up but since I only take one trader’s trick set-up in a trend, that trade was not valid.

The next trade was a trend line break above the 56 EMA followed by a trader’s trick set-up. The trend line was started back on March 28 high pivot.  Here is the chart for trade 2.

Trade 2

Click on chart to enlarge.

The final trade of the day happened after a trend line break to the down side followed by another trader’s trick set-up. The trade was up 1.80 points. The stop was moved to break even. The trade broke even. Here is the chart for trade 3.

Trade 3

Click on chart to enlarge.

So for today, there were 3 valid set-ups with 2 winning trades and 1 break even trade for a net profit of $400 on one contract, ignoring slippage and commission.

Today was another volatile day with few set-ups. Hopefully April will bring us a little less volatility and more profitable set-ups.

Here’s to catching  a whopper.

Best regards,

Ron

This is not a solicitation to buy or sell. 
There is a risk in any investment.