BS"D

Good morning,

We squeaked out a couple of trades Monday, as
Price Action dropped below the 50% Fibonacci
Retracement Level.

Heading for the Fib 62% on Tuesday?

Enjoy and be well,

DAILY PIVOT MAGIC TRADING JOURNAL - EXCERPT

******************************
Pivot Magic Trading
First rule:
"Any time you don't know what
is happening, get out!"
******************************

E-mini ES H2
Monday December 19, 2011

Our week opens gap up above the Pivot. Price Action promptly returns to test the Pivot
Support, with no success, for at least half an hour.

1 = Look closely, and the reversing (red) candle makes a preceding trend for a 2-bar
completing on the 3rd candle. At worst, this is a 123 "S" Signal.

A = Volume swells massively (pink arrow), and we are pulled in below the Pivot. At
the close of the candle, move the stop to Free Trade and a few tiks of quick profit.

B = Small gap and an average-sized red candle. Nervous that the DVS (= A) may have
exhausted Momentum, making this an exhaustion gap, consider my convention and safely
move the stop into the gap.

C = Large red inverted (Bull) Dragonfly spikes the Close and retracts. Pivot Scalp exit
is signaled. +/- 3.75 points

2 = A 2-candle 123 through the Close exits the green fog. This is a tough call. Six
red candles in a row is already a long thin trend; however, the Volume is still quite
strong. I'd pass (good ole risk-conservative me), but there is justification to enter
aggressively below the fog.

D = If you took the signal, = 2, this Late-in-the-Move DVS (pink arrow) and a large (7th
in a row) red candle should warn of a stall/retest coming imminently. The position is
in Maximum Profit Giveback (MPG) violation. Place a mental stop at Giveback, but prepare
to exit if Price Action retraces >62% of the candle. It does. +/- 2 points

High Bear Volume drives the Price Action to slam to a halt against the S1/50% Fibonacci
Level (red line). On very low Volume, lunchtime sideways drift slides along that Pivot
Level well into the late afternoon.

3 = Volume comes to life (pink arrow), and we stretch our imagination to call this a 123
through the S1. Enter aggressively below the PL. At the close of this giant Marubozu
(full-bodied sumo candle without wicks) the position is already in MPG violation. Mental
stop at Giveback Level.

E = Large red Spinning Top eases through the Historical S/R (Daily, bottom chart, dashed
lavender line). Normal stop placement (above the high of the candle) leaves the position
in MPG violation. Mental stop at Giveback Level.

F = Large red candle to the S2. Again, normal stop placement (above the high of the
candle) leaves the position in MPG violation. Mental stop at Giveback Level.

Exit as the next (white) candle retraces >62%. +/- 4.25 points

Price Action is halted by the S2 Support, and trades there to EOD close.

PERSPECTIVE
(Daily, bottom chart)

Monday's healthy red candle eased through the Fibonacci
50% Level (red line) and pressed deeper into the old LT
SW Trend Channel (lavender channel lines).

The tape looks prepared for a test of the Fibonacci 62%
Retracement Level.

BE PREPARED FOR ANYTHING, AND GUARD YOUR FUNDS!

REMEMBER: Trade the Tape, Not my Prognostics!

Asher
=] ;-)>

Monday's PMT Chart: