Pivot Point Day Trading Rocks! Exactly as we predicted
in yesterday's PMTJournal, PERSPECTIVE section, "The
long bottom wick and the preceding exhaustion gap tend
to suggest a breather on Tuesday."
This time we took a couple of nice bites out of the S1
test, and are quite content with ourselves!
Thinking "Bear" for tomorrow (see PERSPECTIVE, below),
but with a long weekend coming up, maybe not. BTW,
that means that we're collecting data on Mon. for
trading on Tuesday, so, see you in class on Wednesday,
Enjoy and be well,
DAILY PIVOT MAGIC TRADING JOURNAL - EXCERPT
Pivot Magic Trading
"Any time you don't know what
is happening, get out!"
E-mini ES Z1
Tuesday November 22, 2011
Tuesday morning opens gap-down under the Pivot, climbs back through, and more
than closes the opening gap.
1 = Doji Sandwich "P" Signal at the Close. The Doji dagger is into the heart of
the Signal, weakening it. No entry into the (always considered proven) Pivot.
2 = Sloppy 123 off the underside of the Pivot. Volume (green line) has dropped
off on the continuation of the weak Doji Sandwich (= 1). Pass.
3 = The feeble red Bull Dragonfly breakout from this 2-bar at the Close occurs on
Hello! Volume perks up slightly, as a true breakout pulls us in (2-candle 123,
enter with multiple contracts). Initial stop advances above the MA.
A = Volume really comes to life (pink arrow), generating a giant red candle.
Our position is in Pivot Magic Trading Maximum Profit Giveback (MPG) violation.
Mental stop at Giveback Level.
NOTE: Bloated ABS warrants expanded stop, exit,
and MPG placements today.
B = Small exhaustion gap and a large red, but Bullish, Doji/Dragonfly each suggest
failing Momentum. Prepare for an emergency bailout. This seems an appropriate
time to apply my convention and to place the profit-locking stop in the gap.
C = Late-in-the-Move DVS (pink arrow) is a final exhaustion sign. Another small
exhaustion gap precedes a giant red inverted (Bull) Dragonfly. The tail stretches
to test the S1 and retracts. Pivot Scalp exit is thus signaled. +/- 6 points
4 = Beautiful Double Bottom through the S1. Were the any Volume boost at all, we
might rely on the double rubber bands, the Close and the Pivot, to reel us in during
D = There it is! A giant DVS (pink arrow) pumps a huge white candle, which pulls us
in. By the end of the candle we note that the top wick has retraced 1.75 points.
Since we will plan to jump ship anyway at >2.50 points recouped profit (bloated ABS),
let's plant our profit-locking stop to 0.75 below the close of the candle.
E = Small exhaustion gap and Twin Towers DVS (pink arrow) rockets a gigantic white
candle through the Pivot and Close. Again, an elongated top wick. That and the Twin
Towers indicate a stall/sag on the next candle. A stop under the Close (also an
acceptable choice) will almost surely get hit; so, advanced traders go flat right
now, and pocket the extra point. +/- 7 points
Volume dies back to lunchtime levels. Sideways drift ensues across the Pivot-Close.
5 = The time is right, and this massive 123 retest of the Pivot Resistance is perfect,
except . . . No Trading Interest/Volume whatsoever. Pass, and shut down for the day.
EOD Hiccup (plum lines) is a bit later than usual, but it does tape a classic "V"
checkmark, as Price Action plummets to the S1 for EOD close.
(Daily, bottom chart)
Tuesday only taped a small red breather day candle.
After re-entering the old LT SW Channel (lavender
channel lines), Price Action hovers. The day candle
almost qualifies as a Bear Dragonfly, which implies
a continuation of Monday's healthy plunge deep into
the LT SW Channel safety zone on Wednesday.
BE PREPARED FOR ANYTHING, AND GUARD YOUR FUNDS!
REMEMBER: Trade the Tape, Not my Prognostics!
Tuesday's PMT Chart: