BS"D
Exploit Pit Pivot Points
Daytrading Course
Learn to Read the Tape
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DAILY PIVOT MAGIC TRADING JOURNAL - EXCERPT
Good morning,
It's hard to take large bites out of a narrow-range day.
Well protected by our risk-conservative Money Management
approach, we did OK.
Monday's tape describes a daylong Descending Triangle
(light blue lines). Might Tuesday morning be bearish?
Stay tuned for further adventures in the e-mini.
Enjoy and be well,
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Pivot Magic Trading
First rule:
"Any time you don't know what is happening, get out!"
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E-mini ES H3
Monday 10 June 2013
1 = A powerful Double Top at the R1 upgrades our gap-up opening candle from a giant red Bear Dragonfly,
to an Anomaly (Overnight, bottom left chart) kickoff Reversal Signal and breakout, and a 123, through
the R1. Volume is massive (pink arrow), so we are pulled in below the R1.
A = Large red Bear Dragonfly through the HighW. Per our stop rules, move the profit-locking stop above
the HighW/Free Trade and a tik.
B = DVS (pink arrow), perhaps even a Twin Towers, plunges a giant red candle through the High. Normal
stop placement leaves the position in PMT Maximum Profit Giveback (MPG) violation. Mental stop at
Giveback Level.
The next candle tapes a white Bull Dragonfly. Price Action desperation spikes and vigorously recoups
profits. Above the MA, exit briskly, or if you must, at >2 points recouped. +/- 3.50 points
Aggressive Doji spike stall, and Price Action continues the high-Volume plunge to close the opening gap.
2 = Volume is still at opening levels behind this serious 2-bar/DT Multiple Bottom through the Close.
C = We are pulled in on a large white candle.
D = DVS (pink arrow) pumps a failed test of MA. Per PMT stop rules, move the profit-locking stop under
the MA/Free Trade and a tik.
E = Volume drops, and the tape presents a small exhaustion gap and a very skinny white Bull Dragonfly
(mosquito?). Just shy of MPG violation, we have no clear exit signal. Safely apply my convention.
Slip the stop into the gap.
BTW: even were we at MPG, and naturally be forced to exit due to the no applicable stop on such a small
candle rule, my convention is designed for this situation. By opening one more legal stop option, we
secure almost all the profits, and yet let the rest of the profits run (low-risk). Best of both worlds!
F = Decision paid off. With an exhaustive burst, Bulls drive a giant white candle north, ripping
through the High. Per PMT stop rules, move the profit-locking stop under the High.
G = Large white Doji Spinning Top candle. The exhaustion is final. This is a serious stall/retracement
precursor. Briskly move the profit-locking stop under the low of this candle.
Next candle makes it a mid-air Reversal, and the Doji following that reveals how complete the Bull
exhaustion truly is. Exit Now! and gain a point. +/- 3.25 points
3 = Vigorous singing stall breaks out for a brief test/Reversal off the R1.
H = Recognize this candle (= A)? We enter below the HighW. At the close of the candle, we move our stop
above the MA.
J = Lonely DVS (pink arrow) expends the last of the Bear Momentum generating the appropriate large red
Doji Spinning Top. Move the stop to Free Trade and a tik. Taken out next candle.
4 = Counting the Overnight, we can stretch it to call this a failed TTT. A low Volume lunchtime move is
a very questionable entry. Gravity and pull of the Close will make up for some of that, but not enough
to justify a trade here.
LET'S PRETEND - FOR DISCUSSION ONLY - NOT A REAL PMT TRADE
K = We are pulled in below the MA/HighW. Stop advances above the HighW.
L = Red Marubozu is not large enough to invite a stop move. However, the overall scenario does invite
us to move our stop to Free Trade and a tik.
N = Large (almost large) red candle spikes the High. Move the profit-locking stop above the high of
this candle.
P = A DVS (pink arrow) found growing in the middle of the dessert plunges a giant red candle through
the High. Per our stop rules. move the profit-locking stop above the High. The stop placement is also
at MPG violation Giveback Level, so make it a mental stop.
R = Average/small red candle puts us deeper into MPG violation. With no excuse to tighten the stop,
the rules say to exit briskly. +/- 3.0 points
NOT BAD FOR PRETEND!
5 = A 2-bar/DT Multiple Bottom off the Close. Look vaguely familiar (= 2)? Total lack of Trading
Interest/Volume, so we shut down for the day.
Price Action bounces along the Close to EOD close up 2 points from Friday.
PERSPECTIVE
(Daily, bottom right chart)
Monday tapes a hesitant white breather day candle. They may still
be gasping for breath on Tues; however, if the BBs have caught their
breath, the Channel Floor retest before the Bulls try to press the
Price Action deeper into the Channel (which we predicted for Monday)
becomes likely on Tuesday.
REMEMBER: Trade the Tape, Not my Prognostics!
BE PREPARED FOR ANYTHING, AND GUARD YOUR FUNDS!
Asher
=] ;-)>
Monday's PMT Chart:
