- the doted acqua lines are the previous day high (PDH) and previous day low (PDL)
- the black lines are the value 0 and 1 of the fib extension (in my charts when the lines coincide with the PDL or PDH, the black line hides behind the doted acqua line)
- the red lines are the -50% fib and –1.38 fib retracement
- the green lines are 38% and 100% fib extensions
I took two trades with RIO. The first one was a long trade after a head fake at the ORL. After printing two offsetting bars (the second one with long lower tail) RIO printed two NR bars. The second bar was also touching (although a little bit lower) the ORL. Exited at the first sign of weakness around at the –50% retracement area.
The second entry was short when RIO printed a spinning top right below the –50% retracement area. I exited at the first sign of strength.
The second trade was a failed one and I played an offsetting bar right at PDH. I am going to study this chart a bit better because I am not sure why it failed. One possible cause is that WFC had already tested the ORH at noon then made a lower high before testing it again. So one way to interpret the chart at the point of my entry could be to see it as an inverted C&H. Another thought is that price in fact reversed at $25.50 (around 2pm), and that is pretty close to the ORH (ORH was $25.64). So in fact the real support area was the ORH, not the PDH.
12 comments:
Beautiful job in RIO! I almost thought I was reading a post on X's blog!
Don't overanalyze the WFC thing...sometimes they just don't work...this is a probability game.
And remember, even Trader-X is only right 80% of the time!
Good work!
-AT
Hi AT~
I saw your YM trades today. Congrats on a profitable day!
Cheers,
Hey Anarco,
Nice charts! I like 'em.
On WFC, a couple of details are 1) the down thrust that took price to the PDH was on increased volume, and 2) the offsetting bar (where you entered) was on weak/decreasing volume.
Thanks for commenting on the failed trade Jim. I truly appreciate it!
I think my platform may not be giving me the correct numbers because the down bar (prior to my entry) shows 354K and the up bar (my trigger bar) shows 352K. Is that what you have? If that is the case, do you think that 2k is a significant difference?
Thanks again.
Anarco,
Great trades and analysis! I can't figure out how you trade with no moving averages. It is awesome. Keep up the great work.
Tyler
Hey Tyler~
At this point I am trying to really understand price action. For now, I am experimenting with the Fib Ext and candle formations. I find the charts from Trader X very useful.
Cheers,
Anarco,
Good trades but the charts are confusing for me. That's life: too dark backround color but like no ema's. I went back to Monday's gap down high to Wed morning low Fib, retraced 50%, reversed. BUT keep in mind the LT fib #'s for the Xgiving bear rally low-hi: 11.73(.22) 11.17(.38) 10.71(.5) 10.27(.62) 9.63(.88), reversed at 9.61 with spt also on a 2 or 3 wk 60" chart with 20 ema
Excellent job Anarco!
RIO was perfectly executed. Thought process on WFC is bang on. Ditto Jim's point - The 3 consecutive red WRBs that form the cup are creating a counter trend. In cases like that, I like to wait for three consecutive higher closes to offset. Prices usually consolidate after 3 consecutive bars, once they print, you just have to pick your spot. In this case, it didn't happen until after 2:00, but once price settled into that zone, it formed a solid base.
Thank you very much for the feedback Jamie!
I information about the 3 bars and the consolidation process is extremely useful to me.
Cheers,
those fibs are magical.
Anarco,
Following up on your relative volume question for WFC, I do show the same volume as you on the offsetting bars. However, my weak volume comment was relative to the volume in the 3 consecutive red WRBs that Jamie mentioned (the down thrust). Notice the volume in those down bars (515K, 1.09M, 908K) versus the weak volume in the offsetting up bar (352K).
Also, a 15min chart provides a clearer picture of the strength of the thrust down to the PDH. The 12:00 candle is a full-bodied WRB. Hope this helps.
Hi Jim~
It is crystal clear now. And that full body WRB in the 15min chart tells the story.
This helps me a lot.
Thank you!
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