Lots of discretionary trading possibilities Monday, so some of us scored
real well, and some of us were mostly frustrated. How'd you make out?
Have a great New Year, mankind!
Enjoy and be well,
DAILY PIVOT MAGIC TRADING JOURNAL - EXCERPT
"Don't gamble; take all your savings and buy some
good stock and hold it till it goes up, then sell it.
If it don't go up, don't buy it."
E-mini ES Z1
Monday September 26, 2011
Monday morning opens gap-up at the R1. Price Action heads south, spins around, and retests
the R1 Resistance.
1 = A Doji Sandwich-like 123 off the R1.
NOTE: ABS is already very bloated. To avoid being taken out at every
swing or adjustment, expanded stop, exit, and Maximum Profit Giveback
(MPG) placements are advised.
A = We are pulled in on a giant red candle. At the close of the candle, move the stop to
The next candle spikes the Close and turns white. Pivot Scalp exit. +/- 2.50 points
Turns out to be an S-trap, from which we now learn to give more leeway when the ABS is
2 = Full-sized Double Bottom off the Pivot/at the Close. We enter aggressively as Price Action
leaves the green fog.
We wait out the S-trap this time.
B = Large (average?) white candle. Per our stop rules, move the profit-locking stop under the
low of the candle.
C = Another (somewhat) large white candle through the High. Per our stop rules, move the
profit-locking stop under the High.
Depending on how much we expanded the stop placement, we either got taken out (+/- 2.25 points)
or weathered the S-trap and rode the move for 2 more candles, when the Momentum came to a halt
at the R1 (+/-5.75 points)
3 = Lunchtime gives us pause, as the tape presents a 123 at the R1.
D DVS (pink arrow) and we re enter on a giant white candle. At the close of the candle,
advance the stop to Free Trade and a tik, where we get stopped out.
Lunchtime is confused, first sliding sideways along the R1, and then drooping to retest the
4 = Double Bottom off (within range of) the Close.
E = 2:00, and Volume (pink arrow) springs to life. We are pulled in on a giant white candle
through the R1. Advance the stop under the R1, only to promptly get stopped out.
+/- 1.75 points Ouch!
5 = Nice "P" Reversal off the MA qualifies as a PMT "S" Signal. No Volume, so no aggressive
entry is permitted.
F = Volume (pink arrow) recovers, and we are pulled in on a large white candle.
G = A low-Volume S-trap yields to a slightly large white candle to the R2. The R2 Resistance
may halt the Momentum, so use a mental stop at under the low of the candle/MPG Giveback Level.
H = Price Action penetrates the R2 just enough to let us move the profit-locking stop under
Price Action does slow and beginning traders wisely exit. +/- 3.50 points. Advanced,
experienced traders, however, do the math and see that we have nothing to lose and adopt a
wait and see/let profits ride stance.
ADVANCED PMT DISCRETIONARY TRADING TECHNIQUES
J = Large white candle bounces north off the R2, putting us in MPG violation. As trading
enters into the EOD Hiccup Time Zone, a mental stop at Giveback Level gives us good exit
flexibility (no Cancle-Replace necessary).
K = Average-sized white candle puts us again in MPG jeopardy. Once again, with nothing to
lose, be creative and move a mental stop to Giveback Level.
L = Smallish white candle. Volume is still booming, so we want to let profits ride. The
elongated top wick warns readers of the tape that Momentum IS waning, and that a Pivot
Scalp exit is probable. Move the profit-locking stop under the low of the candle.
N = Same story with this average-sized white candle. Mental stop at Giveback Level in
preparation for the Pivot Scalp at the R3 Resistance, which is getting more likely.
P = Price Action spikes the R3 and retracts. The gigantic Black Volume Bar of Death
(pink arrow) Doji (plus our exit-before-the-EOD-bell rule) advises a Pivot Scalp exit.
+/- 11.75 points
(Daily, bottom chart)
Monday's large white candle moved deeply into the heart
of the LT SW Channel (lavender channel lines).
A Failed Third Time Through (TTT) off the Channel Floor
initiates a Failed TTT Corollary situation. A Channel
Ceiling test may be underway.
BE PREPARED FOR ANYTHING, AND GUARD YOUR FUNDS!
REMEMBER: Trade the Tape, Not my Prognostics!
Monday's PMT Chart: