I have to attend some personal business so I am calling it a day, and a very good day indeed! PBR and Oil in general were strong at the offset, but at around 10:15am the market mood changed. We can see in the $XOI index how price is unable to maintain pressure above the previous day high. The 4/15 bar for PBR is a very clear bearish engulfing pattern and that catapulted price to test the previous day high on high volume. After that, PRB started to print an orderly bear flag on decreasing volume. The pattern is not as easy to see in the 15min or 5min as it is on the 1min chart, so I decided to manage my trade of the 1min chart. Price found the appropriate resistance at R1 and at that point I decided to jump in. My entry was at $62.58 and my stop loss was $62.83. Price collapsed at that point and since other Oil stocks were also quite weak I did not take a partial at the previous day high. I held it until $61.00 (PP) where I took a partial and I was stopped out 10 mins later.
6 comments:
Excellent trade. How do you guys spot these patterns right on time? Touches the fib. extn. at 100%. Was that your target when you entered the trade?
I am learning to trade flags. Do you think at around 3.15, is RIMM forming a bear flag on a 1 min. chart? The flag initially have a good volume, then the volume decreases. Can it be called an orderly bearish flag?
Thomas
Anon1~
I have a set of 25 stocks (my Watch List) that I have open throughout the session, and I look at them all the time. Additionally, the futures started high this morning and it seemed like Oil was going to take off to another high, so I kept oil-related companies on my radar.
Thanks Thomas!
I am also learning to trade flags, but for whatever is worth, I would say that the 3:15pm on RIMM is a beautiful bear flag. It takes place after a decisive move down, and it also offers the bonus that is setting up against the S2 Pivot Point, which would offer additional resistance and push the stock down. Also what is nice is the descending volume while the flag is forming.
Thomas!
I just realized tha Jamie's trade of the day was the RIMM setup you were asking about. It is worth checking his site out.
Thanks anarco for your response. I visit Jamie's blog everyday and it was rather a link on his blog that I found about your blog. I saw Jamie's post a little later after I commented on your post. :)
Keep on posting your trades. Even failed trades are valuable lessons.
Happy trading!
Thomas
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