Fib time...

I don't really post about Fibonnacci numbers because i don't understand the mathematical workings of Fibonnaci, BUT one thing i know is that a lot of people use Fibonnaci and thus these 'numbers/points' create support and resistance lines because 'so many people use them'; thus they become psychological points.

Here is an interesting comparison of the recent 'highs and lows' of June as per the Fibonnaci numbers. You can see that the XJO has retraced back of the June lows to the 50% line BUT the DJIA has only retraced back to the 38.2% and is hovering just above the 23.60%

For me this is showing mass divergence; If the DJIA falls then the XJO will fall even harder and if the DJIA rises than the XJO will most likely stay flat. For me this has created a low risk trade on the downside, i'm actually expecting the XJO to hit the 61.8% number and then fall.





-Note; end of finacial year tomorrow, expect the unexpected but i think it will be a big non-event as in previuos years.

safe trading

Again from 'The Master'

bull/bear , i dont wear either coat . im a trader my bias changes like the wind , if yours doesnt maybe you might want to look at investing or term deposit . my bias can be conflicting on different time frames . just trade the one that aligns with the time frame you are trading in . the market goes up and down and i like to catch both moves if possible and i have been . dow this week has been amazing for me nailing tops and bottoms within small margins over large ranges and it feels good . JD ,jaolsa , treggs and a couple others been doing same . getting a feel for market flow takes experience that is really only gleaned from years of chart gazing . can of worms i know , there are thousands of books on TA . very few if any will ever teach you how to trade . ive been down this road . PRICE and TIME ... all you need . the holy grail is your own mind not some nondescript wiggly line . as for the fundementalists out there . find the fundementals and use charts to fine tune entry and exits . when your wrong your wrong , its never the markets fault . if you experience severe drawdowns i suggest you need help defining when you are wrong and what to do about it . entry really is everything as it defines the point at when you become wrong . the better the entry the risk can be reduced . patience is needed , wait for market to come to you , if it doesnt other opportunities will arise . i have on occasions sat all day at screen and not made a trade . sometimes the best trade is no trade , if setups arent forthcoming dont make ones that dont exist . im of a belief that you need a certain type of mind for being a chartist . in IQ tests my pattern recognition skills are quite often 100% , i have a strong understanding of maths , was a distinction student in high school maths . ive tried to teach some people and they just dont get it . just not quite wired right . i see a lot of people studying trading like its some form of quantum physics . it isnt easy sure but it isnt that hard . for those who aspire to be a daytrader dont get caught up in cycles and day counts , your universe is the days session and quite often only the minutes in front of you . focus and discipline , if you need to come to HC for reinforcement of trade plans you are not ready . posting here is to kill time not for tips or trades . ok killed some brain cells back to the boredom of trading . by the way once trading becomes boring you have probably made it ;-)

Big Call....time

Ok, its time to make another big call, i think we may have a similar set-up to the same period in late May. People were calling tops and the need for a pull-back and its very similar to now. Markets are not linear so a retrace 'up' before a more solid move 'down' is needed.

the big call - 3920 on the 30th June then a move 'down'.

The below graph highlights what happened in late may and what i believe will happen now. this is represented by the 'blue' lines.

Note; the red line is a L-T Fib line on a 'weekly/daily' chart that i have previously posted.

Also seems like the 3720 might not get touched just yet, but don't rule that out in the S-T (i was hoping we would hit the 3720 in last nights trading but i could be a day out)




safe trading

More from the Master

Critical thinkers: distinguish between fact and opinion; ask questions; make detailed observations; uncover assumptions and define their terms; and make assertions based on sound logic and solid evidence.

safe trading

I want my mummy

Well no harm has been done, i was waiting to set myself into a nice short position but i think the opportunity has gone and i will be looking for small bounce to go long then to go short.

the first 'stop' for the Dow is 8220 and the XJO is 3720. Below are both the charts. I will be looking for a bounce of these support levels.





I'm now a little uncertain about the next week or so's trading, short-term focus is the game plan. Holding these bottom support lines is critical....but i must stay 'open' minded and not try and tell the market where to go but trade with it.

safe trading

I'm feeling it - Can you?????

The 'Bear Trap' kind of played out. I've drawn a final channel line indicating that this is the 'line drawn in the sand'. It is indicated by two touches 'circled in red' that show what i beleive to be the 'bottom' up the up-ward channel.

As you can see this is holding so far and the Dow is 'bouncing' back a little.



Now for the Xjo;

Its doing very nicely, it pulled back to a previuos trend line 'nicely' and is bouncing now just like the Dow. As like the Dow its 'overhead' resitence is just insight.....i'm getting a tingling feeling - LOL

First chart is a 'wider' view to show a more wholistic view and the second chart is a 'close' up.






This blog is starting to focus on the Dow. I do not intend to turn this into a Dow blog but it is providing a very nice trading/guidance indicator for the XJO (this is most always the case anyway). I will turn my focus to the XJO once this scenario plays out.

safe trading

Quick Post.

updated DJIA. Bottom channel will hopefully hold. Watch for false break to the downside then a quick up movement back to resistence (looking for a bear trap - everyone goes short, then all the shorts get wiped out, market makers make a killing and the individual gets hammered.)



safe trading

Don't throw the baby out with the babies water.

I haven't yet given up hope of a rejection of the down-trend line....we just need a little faith.

First chart is the DJIA overhead resistence, that i think played out quite well and this weeks trading will give direction for the coming weeks (potential sideways). There is a clear touch and rejection, she is still in her up-trend and i think she will have another go at the overhead resistence.



Next up; is an up-close picture of the up-ward channel with overhead resistence drawn on it. As you can see a very nice touch a rejection but still in a up-ward channel.



Fianlly our beloved XJO. She didn't do what i was hoping for but such is life. I've drawn a possible scenario and maybe this time it will work.



NOTE; the XJO and US are moving fairly closely in terms of hitting overhead resistence at the same time...maybe it can be a perfect hit....time will tell

safe trading

Come on 'baby'.

Updated chart of the upcoming scenario, its working out so far but today trading and tonight in the U.S is all too important (stating the obviuos).

Updated; DJIA

I posted this graph last Thursday and i just wanted to show you an update.

The channel is working beautifully....time to show 'some' caution



safe trading

The Set-Up

This is setting up to be a perfect touch and rejection.

The first graph is a close-up of a scenario that could possible play out tonight in the U.S or on Monday's trading. Weakness in early trading in the U.K will see a 'slight' pullback then when the U.S opens we see a final push to the 'red circle'.

Just to note that the dark black line is the bottom trend line of a channel that started mid-March and ended late April, it is now acting as resistence, and the diagonal line on the 'overhead' is the line i previuosly posted in the long-term chart.



and finally a more wholistic graph for better viewing



safe trading.

From the Master

This bit of information is from a trader that I follow very closely and try to emulate.

LAWS OF MULTIPLE TIME FRAMES

1. Every time frame has its own structure.
2. The higher time frames overrule the lower time frames.
3. Prices in the lower time frame structure tend to respect the energy points of the higher time frame structure.
4. The energy points of support/resistance created by the higher time frame's vibration (prices) can be validated by the action of lower time periods.
5. The trend created by the next time period enables us to define the tradable trend.
6. What appears to be chaos in one time period can be order in another time period


also;

Anyone can make the simple complicated. Creativity is making the complicated simple

Trading is about defining probabilities and managing the possibilities

Trading is like taking Viagra , you can make it harder than it needs to be.

- My advice is to print this out and stick it infront of you when trading.

safe trading.

Just some graphs

Think they are self explanitory....must break resistence that is starting to form and if so i think she has only a little bit to go.

safe trading

Long Weekend

Its the long-weekend and i plan on taking full advantage of it.

here is an XJO chart with the 4000 mark acting as resistence.



have a nive loooooooooong weekend

safe trading

DJIA Chart

Nice upward trend. The question is for how much longer will this continue?



safe trading

Clear sign show (S-T???????)

Should have been more convincing in my own analysis yesterday. I stated that i was 'sitting on the sidelines until a clear direction was shown'. Well that 'probablitlity' was identified yesterday but i didn't manage the possibilitites.

The D-T was shown as a clear reversal point and thus i didn't take adavantage of it. Although the top was reached in night trading a simple conditional order with a tight stop-loss would not have gone astray. I guess that is what this blog is for to detail my trading patterns and emotions.

A key part of becoming a successful trader is to bottle the emotions and trade the system you have developed and entrusted. Today has been a valuable lesson and one i will try not to forget.

Anyways here is an updated graph with my target area being hit perfectly and then rejected, in the few minutes since opening this morning the market has gapped down and currently around the 3950 area.



now waiting and watching to make my next move.

safe trading

Will we make a D-T

Well the falling wedge broke to the upper side and the bulls have taken control again. It was thought that maybe the late push into the end-of-the-month rally was 'window dressing' by large funds and was going to come off in Monday's trading session.

The question now is; will we make a higher high, a lower high, a Double-Top and then where do we head after that.

Still caution should be shown, we could be lead into a false sense of security thinking that this bear market is over. Sitting on the sidelines till a clear trading direction is established.



safe trading