The Q’s opened pretty neutral this morning @ 78.75 and immediately set the high of the day within the first 15 minutes of trading @ 78.81. Then the 5 minute low was taken out and a pivot low was set by 10 am reversal time. The market rallied into 10:20 triggering the first sell on the 5 minute chart and it has been all over for longs as the market plummeted breaking the last pivot low @ 78.00 and ending the uptrend on the daily chart. Currently price action is very week with the low of the day set @ 77.19 by 2:20 pm reversal time.
QQQ 10082013
My play of the day was in WMT which I found using my 9:45 wide range bar scan but at 10:00 am since I had no stocks that qualified to be on my list @ 9:45 am. This happens sometimes so I wait for the first 30 minute bars to close on the 30 minute chart. Usually I’d have something else to trade, but today I found myself with a really short list of stocks. WMT had a nice solid 30 minute bar so I started to watch it closely until price had a small 2 bar pull back on the 5 minute chart. Not a textbook entry but WMT had huge relative strength compared with the market and since we were near 11:15 am reversal time, I thought that the market may start to show some strength, and a long trade would be the right play. Once I entered the play above .89 with 1/3rd lot size, I found myself already offering out shares as price flurried upward, a market gift as some traders describe. WMT then faded slightly but soon triggered a pretty nice buy setup where I added back another 1/3rd lot to my remaining share size. Then price ground it’s way upward as price put in 7 green consecutive bars on the 5 minute chart allowing me to offer more shares out for profit. I had raised my stop to just below the 5 minute pivot after my last 1/3rd add, which I thought might hold through lunch, but shortly @ 12:30 pm my last trailing shares were sold for a slight profit. Not bad, a full “R”isk unit made using a partial share size to start, demonstrating the power of “Add and Reduce.”
