A very good day

There are two charts below.  The first chart is the 30 minute of the Dow Jones Industrial, and the second the 20 minute. (Sorry, you will have to scroll down to the second chart as I can't seem to get the charts close together). I could have used any of the 15 or 10 minute charts because they were also showing principles.

To take the 30 minute chart first.  Remember, we always look at the larger timeframes first to get an idea of the general market - weakness or strength.  At Point A we see a sign of weakness - supply coming in, shown by it being an up-bar with increased volume - professional money, at the market open, have driven the price up and sold to the herd.  At Point B we have confirmation of this as the bar is a rapid down-bar.  At this point we want confirmation that the market is weak, and we see this at Point C - the market has gone up (towards that resistance level marked R13026) on low volume - this is no demand - back up to that level.  However, the market, just to trick you, takes the price up at Point D (so the herd think prices are going up), but only for it to fall on the low (similar to what we call an 'upthrust' - also a sign of weakness).  At this point I'm getting excited.  But, being a careful person, I want further confirmation, which I see on Chart 2 - the 20 minute chart. At Point A there is no demand - the market has reached this level and there is little interest in higher prices at that resistance level.

Finally, you will see the market reaction - a rapid down-bar.  I went short (sold) at the close of the 20 minute no demand bar at Point A and took 54 points profit.

Finished for the day.  It is always good to finish 'up' so that you are confident to face tomorrow.  I believe psychology plays the biggest part in trading, and it is the hardest aspect to overcome/manage.  I will talk about this another time.

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