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A Strong Down Move

July 24, 2012

There was plenty of movement today, so I’ve split this into two charts:

Today’s Trading Chart A

Today’s Trading Chart B

Having (I thought) most likely put in a short term low at 1325 on the daily chart yesterday, and with an upward-sloping support line under the pre-market action, I was initially prepared to go long after today’s open in the area I have highlighted in grey. However, a failed rotation to the upside caused me to re-evaluate my bias before I was filled, and so my first entry was to short a pullback to the resistance line.

This was followed by two more shorts entries. For the second of these I used the EMA rather than a resistance line, and unfortunately this led to a premature entry and my stop-loss was hit.

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Daytrading Chart 24th July

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On the second chart another three entries can be seen. After the market sold off following my first entry I moved my stop to breakeven. I was lucky not to be stopped out here as the market came within half a point of my original entry before finally selling off into my target.

The next trade was a short into a trend change. This was arguably a poor decision, as a higher low had been made (highlighted in grey); however, note that I had the patience to place my order at the higher resistance line when the EMA and lower resistance failed to offer a sufficient potential reward for my risk.

Having concluded that a reversal to the upside was underway, I bought the pullback to the EMA for my final trade of the day. For a total of $537.50 per contract, my trades were:

+2.25  /  +2.75  /  -1.50  /  +5.00  /  -1.50  /  +3.75

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