BS"D

Good morning,

Hope you weren't too "Primed for Bulls on Monday."
The Bears ruled, and we gratefully caught the long
morning ride down the BBs' Plunge-Slide maneuver.

Need a few more days like that!

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 H3
Monday 04 February 2013

Monday morning opens gap-down below the S1.

1 = With a minimal preceding trend, this is a 2-bar off the S1.

The 123 kickoff (blue arrow) actually completes a Head and Shoulders
formation. Prepare to enter with multiple contracts.

We are pulled in on a healthy red candle. Advance the stop above the MA.

B = Large red candle breaks free from the stall (today's ABS is very small;
tighten exit, stop, and Maximum Profit Giveback [MPG] placements).

Per our stop rules, move the profit-locking stop above the high of the candle.

C = Large, skinny, red, Spinning Top finally breaks free of the MA. Per PMT
stop rules, move the profit-locking stop above the MA, or better yet to Free
Trade and a tik.

D = Failed test of MA. Per PMT stop rules, move the profit-locking stop
above the MA.

DVS (pink arrow) only manages to generate a small white Doji Hammer,
strengthening confidence in our position.

Stall resumes, but we feel safe to rely on the well-proven MA ceiling.
E = Large red candle/Failed test of MA dips to the S2. Due to the
diminished ABS, our position is now in MPG violation. Mental stop at
(foreshortened) Giveback Level.

F = On the one hand, Volume is still strong, on the other, this small red
candle vaguely spikes the S2.

There is not really any rule, but a mental tightening of our stop, = E,
seems appropriate:

a) Shortening exit from a bounce

BUT

b) Leaving the strong Volume opportunity
to continue the ride

G = Volume is strong (pink arrow), and we add contracts as this large red
candle completes the 123 through the S2. Stop moves down above the S2.

H = Volume perks up (pink arrow), and Price Action breaks south from a 123
test of S2 Support-turned-Resistance.

J = Not sure if this is a gap and a large Spinning Top Doji, but Volume is
certainly dragging. The BBs are getting hungry, and this run is exhausted.
Apply my convention and slip the stop into the gap.

Stopped out on the next large white candle. +/- 5.50 points

Lunchtime sideways drift along the underside of the S2.
That sums up the afternoon!

EOD Hiccup (plum lines) is a few minutes early, but tapes a classic "V"
check mark pattern, as EOD Price Action dives to bounce off the S3 Support.

PERSPECTIVE
(Daily, bottom chart)

Monday taped a particularly healthy red day candle.
The close actually exited the LT Trend Channel Floor
(green channel lines). Trading Interest is dull, so
the Bear adjustment dip will need a bit more time to
work out. Besides, it is not altogether certain
that the red line isn't the true LT Trend Floor!

REMEMBER: Trade the Tape, Not my Prognostics!

BE PREPARED FOR ANYTHING, AND GUARD YOUR FUNDS!

Asher
=] ;-)>

Monday's PMT Chart: