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A Good Day for Shorting

July 20, 2012

The entries today were all short, with three wins and one loss. A good way to end the week! What I wanted to draw your attention to, however, is price behaviour during the first hour of trading:

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Daytrading Chart 20th July

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You can see that I shorted at the open, and then attempted another short after the market made a new low, and then I stopped. Why? The market made a series of both higher highs and lower lows (on a higher timeframe chart this might appear as a series of ‘outside bars’). I have marked these price swings in white. I have absolutely no interest in this as a pattern. All I’m interested in is that the trend is unclear. After that second trade I don’t enter again until the market fails to make a new high – I have highlighted this lower high in grey.

View Today’s Chart

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