leovirgo's Blog

DOW Trading

22/11/2005

Today, it opens lower from 10820 to 10790. But it can't break it any further. 12SMA is still above 78EMA in 5min chart. Dow just touches EMA line and bounce back. RSI starts to strengthen in 1min chart, followed by 5min chart. It looks like accumulation is taking place. So I buy it, 1520hrs.

A mini upside break out occurs at 1800hrs, that is the shape of things to come... target is either 10840 or 10850 depending on which triangle to use. Yes, the final breakout comes at exactly one hour later at 1900hrs. Move my stop up. But can't resist the temptation to close a winning trade. Close my long position at 10832 ( price was 10835). I thought I should give some allowance in price targeting.

No, it reaches my target 10850, even higher, just 5/10mins later.

Lesson is.. stay in the trade until it reaches the target. Then, liquidate half the trade and keep the rest with break-even stop for all the way as long as the trend continues.

But I congratulate myself for successfully implementing a trade plan.

DOW trading

23/11/2005

Well, futures were down pre-open but the market just continued with the rally. It touched 10900 around 1550hrs... may be this is the indication that it wanted to go ahead. But there were some divergences..e.g, RSI in 5min chart.. but quickly resolved by moving up 10910. Did I buy? No. And not the time to sell. Just observing.

Addition at 2055hrs

I took a SELL position at 10917, believing that it couldn't break 10920. I knew it was a risky entry and trade size was reduced to 1/10 of normal size. Suffered 10pts stop.

Once the continuation of rally was confirmed, I took a BUY position at 10928. It went up all the way to 10950.

How was the trade? I only got 3pts. Why? I took an exit prematurely at 10931( Actual price was 10935).

I came to belive that 10940 was the resistance ( someone on T2W thread said that was the March high) and I thought it was turning back. But the DOW just continued moving up to 10950, only then it took a natural breather.

Lesson: The trend is continuing unless there is evidence of consolidation or pullback. There was no such thing today. Even the closing time fall just looked like a natural profit taking.

Market is independent of any opinion formers. It won't adapt to an individual's needs and wishes. The market can stay irrational but how rational can an individual think?

DOW trading

It was an interesting week.. from 28th Nov to 2nd Dec.

I was trying to familiarise myself with CMC's Market Maker software. It was good with indicators but order execution is not desirable. Once I manually close an open position, I still have to cancel my stop order. One time, DOW was falling and I close a winning position manually at market prices as I suspect it will bounce back. I was happy with my profits. But when the prices bounce back then my stop order was executed i.e, I suddenly have a long position. As I set my stop oder at a possible bounce level, the prices fall again from there and I found myself in a losing position. I have to close the position at the best possible price.

That's why order execution and familiarisation with the softwares, trading platforms are crucial part of the trading business.

DOW trading

5th to 8th December 2005

Main Trend
Still debating on T2W Dow forum. Some start talking about having seen the top. What do I think? I don't know. I trade what I see. At the moment, it is forming lower highs and lower lows since 1st December. If I were to anticipate, I will follow 12MA and 78EMA in 5min charts. They did not fail to show a good trend either way. After a low volatility day, when they cross down or up, there is normally more than 50-70 pts to be gained. One thing to watch out- this time, the path to a new high may not be a strong trend as seen in November. It could be a step by step.. higher highs followed by higher lows... bulls dragging the bears... but if the bears win, I think it may be swift. Hang on, the bears may have won already... haven't we seen lower highs and lower lows... well.. just need to watch a couple of weeks. By the way, who says we need to look out for a year end rally or a new high above 11200 etc? It is just an index figure for 30 companies.

Trades
A good week so far.. Dow has been trading in the range. I've been using momentum breakout strategy. I guess if will be good for Pand F swing chart users.


Software
I am becoming more familiar with CMC's MM5. Even then I forgot to cancel a Sell stop order which was given for an overnight trade on 5th. But it was a blessing because when prices broke down from a triangle on 7th late afternoon, giving me a 28pts profit. Still, it is not easy to check Pending order blotter.

DOW records

I've been testing new parameters for my system and now I start using it today. It gave me a BUY signal.

My system is a mixture of swing trading ST and technical indicators TI signal. Basically the trade direction is set by ST and entry is triggered by TI.

Will be posting results everyday unless it is carried over the next day.

BEST FOR ALL $$$,$$$,$$$

Dr Greenspan's $150k per session potential income

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The Washington Speakers Bureau, which handles bookings for high-profile figures like former Secretary of State Colin Powell, did not return phone calls while Fed officials did not respond immediately to requests for comment.

Andrea Mitchell, Greenspan's wife and chief foreign affairs correspondent for NBC television, is represented by the group, according to its Web site.

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DOW: Trend or Swing?

It's hard to say.

When I expect a swing it trends and vice versa. How can I correct it? The best way might be to wait for another beat.

Or shall I be hybrid trader with multiple positions?

Dow a fresh start

It was a nasty blow by Japan's N225. But Dow seemed resilient.
As for my 10907 entry, it was just closed when the price came back to 10910+.

I am trying to catch the rhythm of the market. Today is a perfect Buy day as suggested in the swing system.

Should see a bit of low lower prices, not below 10855 for a good long entry. Anywhere between 10855 and 10900 is a good entry.

Personally, I am becoming sceptical of the predictive market calls based on historical precedents. It's true that on certain kind of days, the market go up. But nobody knows how much it will go lower before that anticipated up move.

I will go witht the flow. Will scalp, then swing... then catch a trend. I believe trading method can be evolutionary process.

A good trade must be right in the beginning which leads to some scalping opportunity. If it continues in the direction, it will swing high or low. Then if it does not return to scalping points, it will start a trend. For me, anything above 150 points is a trend. The risk should not exceed 30 points.

Dow record

This week took off with a bounce. A dead cat bounce? Sure, a cat has nine lives, right? This is one of those times.

My trades

Went long on Monday 23rd. It was a BUY day as in Taylor's technique. Started with a Low then record a High for the day and closed in positive territory.

Tuesday is supposed to be a SELL day where prices challenge yesterday's High and then fall off. Exactly like that. I went long and got out at high. Scaled out the position as it moved higher and higher but it came back at Short Entry.. thus other half position was not as profitable as the first one. But I am happy.

So, tomorrow Wednesday should be SELL SHORT day. I wil sell off any rally, if any. If I am in a positive position on market close, then I will cover it on Thursday morning.

Leovirgo

Dow update

It was nice Selling into rallies yesterday. I did not carry trades overnight as the bullish momentum seemed to be gathering pace.

Thursday, today is a good BUY day. It was already up more than 60pts at the open. No prob, as ADX is above 30 the prices actually rise and rise through 10820+. Out of the trade now. All TA point to a trend day which could go +100 points. And it is already more than 100points up.

17:15hrs.

Dow update

Bullish momentum follow through pushed it up above 10900. According to my little book, it has 60% chance of a reversal. Will go short when weakness sets in. watching...
16:01hrs

Back to Dow

I was taking a day off after Fed day spike and false spike took away my ego.

Now it seems like Dow is falling after weak employment data. I am not very convinced yet and I am not very keen on this fundamental data as it is polysemic. The Fed officials may take an entirely different view. I don't want to speculate based on this.

And since I am a day/ short term trader, it would be more beneficial to trust in indicators and taking prompt action with tight stops.

My interpretation of Fed day news was correct albeit in a late fashion which cost me substantial losses. Playing with fundamental requires more than 20/40 points stop. My money management system allows max 60 points. Ultimately, I was right about big moves -up to 960 and fall of more than 100points. But those moves happened after my position was closed out.

Now I am back. Watch this space..

Dow reversal scalp

Down turn was reveresed by breaking out of 10790 at 1535. It often runs out of steam after 1530hrs.

Waited for a pullback and went long at 10790+ 1615hrs.

As a matter of discipline, stop placed near recent low 10778 and limit sell order at 10814. At least it should retest recent high.

Yep, it moved up to 10830. My limit sell triggered at 10814.

Happy with this managed trade. It is just a QSO ( Quick Scalping Opportunity).

Dow analysis for Monday 6th February

The first hour's trading range needs to be studied.

The momentum (RSIROC 3/1) suggests the break out from intraday range should be followed.
Recovery from last week of January is still in place as shown by slow STC but directional indicators are in the red already, hence the choppy session could be expected.

Buy Side
=======
For the upside, there is still a chance as long as it does not violate Friday's low. TI strengthening in intraday range, above prior day low, could be a good buy opportunity. Gap down open may still create buy opportunity as long as the above condition are met.

Be careful at 10827 ( as failure to go above 10830 will push it back to the range).

If it rallies back, Monday could be a range day. Tuesday will depend on how it closes on Monday. [? on Buy side]

Watchout for false breakout, double heads and HnS etc reversal signs as the down momentum may be gathering.

Sell side
=======
Again, intraday range is crucial. Any bearish TI below the range can lead to further weakness. Follow breakdowns as it occurs.

Sell into any rallies below 10827 ( Thursday's low), target is 10790 ( Friday's low).

Prices could continue with down trend until late Tuesday.
[ TTT suggests Friday was a rather weak Buy day, Monday- Sell day and Tuesday- Shortsell Day. ]

If this is the case, Buy on Tuesday close and Go Short from Wednesday High and cover it later in the same day.
===
Edit at 20:03.

It is certainly a whipsaw day with false breakout and breakdown.
Best to call it a day now...

Dow update

It went down until late Tuesday (7th) as I anticipated in previous post.

Now it looks as if it is making a fresh start with open up behaviour.

Today's moves are crucial for tomorrow and Friday.

Looking to go long if it comes back to 10760-70 area. Anything lower is a weak sign.

8th Feb'06

Dow Update

The sell-off had begun earlier in the day. The down move exceeded the anticipated level 10860 ( which was yesterday's low).

Went long at 10834 with 20 pts stops. Formed a triangle aroung 10880 level and moved up to triangle objective at 10930.

As far as the three day cycle is concerned, it is the one which exceeded the expectation. Every swing has more than 100 points. A powerful cycle indeed.

Monday Outlook
=============

If prices go even higher there is a risk of a reversal. If it came back to today's high, then a nice sell-off may take place.

Gap down open and steady up move is a better play.

Long term Outlook
==============
Wolfe wave up force (target 11180) might be pushing the prices up. A breakout above 10950 is a good sign.

DOW and FTSE

It's a amazing how FTSE has been predictable. Since I have been applying Taylor's Book method into my own TA parameters, trading DOW is getting easier. However, FTSE is the one with 80-90% accuracy. DOW is behaving like a more sophisticated market. In other words, DOW has more market noise.

Today's market
FTSE: BUY day
DOW: Shortsale day + BUY day
(a potential reversal day from yesterday's lows)


For DOW it is a mixed day because DOW is not following the daily cycle. It looks as if it has a shorter cycle. Some of the expected plays such as moving up on BUY day and falling on Shortsale day are happening 3-4hrs earlier than expected. Perhaps it is due to 24hrs futures trading which was not available at Taylor's time. It is our task to apply the same principles in the new digital trading era.

DOW and FTSE

As I said yesterday, FTSE was BUY day yesterday and today it moved up nearly 40 points before turing south.

For DOW, it was a Shortsale day and it did not fail to fall this morning. Fell more than 60 points. But resistance at 10990 area is crucial for next move.

What now?

Today
====
DOW: BUY day and still taking shape...

FTSE: SELL day.. very weak closing, not expected to come back to 5880. Thus, any rally, if any, should be sold off.

FTSE

Not too surprising, it went up and I had a long position which was taken yesterday and closed with a limit sell order this morning.

According to my yesterday's post, any rally in FTSE, as long as it is below 5880, should be sold off, I am now checking my system if it's okay to go short.

But DOW is about to open soon.. which IMO still has some upside to satisfy bulls.. better wait for FTSE to rise in line with DOW and have a better entry point. IF it does fall without waiting for DOW, then so be it.

14:47 edit.

Already covered FTSE short. Nice and quick fall ! I love this kind of set ups.. Still more shorting opportunities to come.

Today
=====
FTSE : Shortsale day
The action has already started. If the down trend is in place, then I will go short again to cover tomorrow. Let's see if I can get a good entry.

16.51 edit

It ened as a V shaped Shortsale day. All declines covered in one session. No surprise. Just wait for a nice long entry on Monday. I know what to expect on Monday. )

The day ended with two winning trades- one long and one short.

DOW

It is now testing above 11060. As I wrote in the previous post, DOW is now fulfilling the wishes of Bulls. The only problem I can't solve at the moment is 10950s during pre-market open spike.

Today
=====

DOW: SELL day

It means selling out a long position.

The closing is not material now as long as it does not close in negative territory.