Oil Review 6/21/2017

Every Wednesday lately, I have put my entire focus on crude or CL.  Inventory numbers are released at 10:30 EST and it causes reaction out of the market.  I had short on the brain since that has been the trend lately.  The above picture shows you the levels above.  Although I did not label it on this chart, 43 was obvious support.

Lets take a look at the 5 minute chart.  Granted I used a 15 minute chart for my entry but this tells a better story.

The numbers are released and crude rockets up 40 cents within seconds.  It broke its 43.80 pivot but ran right into resistance above.  It tried to flag above the pivot but the selling was too much.  Once it got back under 43.80 I knew it was on.  I took a short with a stop above 43.90ish.  I had a 43.00 target.  Amazingly, it knifed thru this area like butter.  This is momentum.  Had there been no news, I am sure 43 had a better chance to hold.

The reason why there was this big of a move, was a failed move higher, and MOMENTUM.  The selling pressure was great because of news.  I was predicting a move to $43.  Momentum made it collapse even further.  I hate to use the word predict, because that is not trading.  Riding momentum is.

This reversal set up is my favorite thing to trade.  Super low risk, and sometimes you hit a home run.  These don't always happen, but it worked because of no support underneath 43 and additional momentum caused by a failed move.

Find the momentum, find your trade.

Watch-list 5/22/17

Trading around previous days highs and lows

Revised Trading plan as of 4/16/2017

My trading plan

Swing Trading:

My entries come from the pullback/flag set-up and a reversal set-up at a support or resistance.

The pullback set-up is when the stock corrects via price.  This would be when a stock breaks a key level for a period of days and revisits the upper portion of this price level.  

A few examples of this would be:

http://prntscr.com/exwjp4

http://prntscr.com/exwk36

Price can also correct via time.  This would consist of a longer flag pattern using key moving averages as guides.  Key short term moving averages that I use are the 9 and 20 daily exponential moving averages.  Followed by the medium 50 day moving average and the 200 day moving average.  For the most part, my entries come from the 9 and 20 emas.  These are the most important to gage the short term momentum.

http://prntscr.com/exwlsb

http://prntscr.com/exwmfo

My all-time favorite, nicknamed the Red Dawg Reversal, is a test of a previous support or resistance that knifes through, and quickly recovers.  This offers a very low risk with high reward.  The average r/r is about 5 to 1 but I have gotten upwards of 20 to 1 with my last shares.

http://prntscr.com/exwo4k

http://prntscr.com/exwp0o

http://pittstrader.blogspot.com/2017/02/my-favorite-swing-set-up.html

Day trading:

Although the list taught to me is lengthy, I mainly focus on one intraday set-up.  That is the pullback set up.  On occasion, I will take an opening range break-out or a red to green trade if the chart is that good.

Before getting into the intraday set-ups, it is important to go over the stock selection.  A random stock will act just that, randomly.  A stock has to have the room and momentum to move “correctly”  By this I mean, there should be room on the chart for the stock to move.  There should be no or limited overhead resistance or underlying support.  Examples of this would be a daily breakout/breakdown of a key pivot level or a stock gapping up/down on news or earnings.  These two things bring momentum into a stock and act the way I was taught.  This is the art of aligning on multiple time frames.  I use the daily and 30 minute chart to identify key levels and the 5 and 15 minute chart to time entries.

The same general rules apply to day trading the pullback set up as it does with swing trading.  The only big difference is VWAP is used.  After the stock’s initial thrust, I look for a pullback/consolidation using key moving averages to time entires.  I wait for a candle or wick to confirm that support or resistance has held and use the bottom of the candle or wick as my stop out.  

Below are a few examples:

Gapper example:

Daily: http://prnt.sc/ec5pq2

Intraday:  http://prnt.sc/ec5qlu

Breakdown example:

Daily: http://prnt.sc/caehu9

30 minute:  http://prnt.sc/caei4z

5 minute:  http://prnt.sc/caejq3

Breakout example:

Daily:  http://prntscr.com/exwy2a

5 minute:  http://prntscr.com/exx0ks

Opening range break:

http://prntscr.com/exx5ij

Red to green:

Daily: http://prntscr.com/exx6bl

15 minute:  http://prntscr.com/exx7ah

Watch-list for week of 3/13/17

The timing of a pullback, paired with a 20 SMA bounce and jobs report was perfectly orchestrated.  We'll see if we get any follow action starting on Monday.  I noticed many individual stocks seemed to be acting weak in comparison to the overall market.  IWM continues to lag which could be an indicator of things to come.  I have many more break down watches than the SPY would suggest.

Scaling in and out. How to take advantage of momentum

Oh Oprah, thank you for providing many opportunities to trade your stock.  WTW's daily chart gave me many reasons to keep an eye on it today.  1.  It gapped up (momentum) 2. It broke out of a years base (room to move on the chart) 3. Stock has a history of going on monster moves intraday

With my case built on the daily, I waited patiently for an intraday pattern.  I was a little weary on when to enter., but when I saw a dip to VWAP hold (cough cough, Jon Schrager) I had to get in on the ORB.

Here is a look at the intraday pattern with details of what I saw and what caused me to get in.

Like all my lessons before, this stock showed momentum, and built on top of levels.  each pullback gave a defined place to risk against.

Here are my entries.  Each line represents where my risk was to

Hope to have a video to follow about this trade.

Watch-List for week of February 27th 2017

Ideas for week of February 20th 2017