Here's today's story. The elephants, they say, always try to cover their tracks. Well, today they didn't bother too much, they left clues all over the place, starting the previous evening.
First of all, there was one unfilled gap above us, and three or four below. Chances are, once the market heads down, it won't come back a hundred points just to fill gap, right? So it makes sense to take care of the unfilled gap above first. In any case, that was our thinking (see last night's video). This time, we got it right.
So let's see the clues:
- Our own first entry, shortly after 8pm. (two contracts, breakeven, manual trailing, target previous day's high). Our 2:1 said this was going up. We listened.
- Retest of a green bar above the close with strong range bar (close=high!). This is serious.
- Volume on a green bar around 9pm, when half the continent is having dinner? This chart is trying to tell us something.
- Another green retest with strong momentum (long bottom tail).
- Serious volume on the retest of the previous day's high just before lunch. You skip lunch, we skip lunch.
- The bar speaks for itself. Our second entry. Trail the trade, exit at 3.55pm to keep the broker happy.
Today was a good example of the importance of chart reading skills (range bar/volume combination) and plain old thinking.
Mindful trading, folks.