And Another ...

Dow Chemicals - acting as strong as the Index, with what looks like a test in a rising market, although the programme is calling it no supply.  Either signal is a sign of strength.

Another one

Another stock acting stronger than the Index, and with a test in a rising market - ideal place to go long.

Stocks

In my last post I said I would be taking a look at stocks, and indeed I have been doing some study, trawling through all the stocks in the US market, and picking out those stocks that are acting as strong or stronger than the Index.  I saw an opportunity in Citigroup (C), and, as you will see in the chart below, it has responded to the strength in the background and is indeed going up.  I'm kicking myself for not going long back when I saw the opportunity, and am now looking for a test in a rising market to enter a trade.  My guess (and it's a guess because you never know what the market will do because a contradictory sign could come in any moment) is that it will continue up to that top trendline.  It has been in an upward trend for some time, zigzagging through the trend channel.  I also have a long list of stocks in my watchlist that are acting as strong/stronger than the Index, and am waiting a VSA principle to get in, namely a test in a rising market.

20 Points Profit

There are two charts below - a 15 minute and a 20 minute.  The market rose from the open and stalled somewhat at the 14980 level.  At point A (in the 15 minute chart) we see an upthrust, and to confirm this, in the 20 minute chart, at Point A we see no demand.  The market fell steadily on this lack of demand and I took my 20 points profit.

I may not be trading for a little while due to the market being closed for a couple of days, and some work commitments before I go away on 15th July, but will keep looking when I can.

Also I am starting to look at Stocks to trade on a daily basis.  My first analysis was correct - Citigroup.  I didn't trade it though as I'm experimenting at the moment. See chart below.  Citigroup appears to be looking as strong as the Index, and at Point A we see a test, immediately after a sign of weakness.  I would have put my stop below the last reaction low and my limit at 100 points.  You will notice that after the test we have what looks like a shakeout, which is a bullish sign in itself.  I will continue to watch this to see how it unfolds.

Lost Today

Today I lost 11 points.  The chart below is a 10 minute chart of the Dow Jones.  At Point A we see what looks like a test - down-bar, low volume, closing near the high.  The test failed, as you will see by the down-bar following, and as I saw weakness in the lower timeframes I got out at a loss.  In hindsight you can see that at Point A we've reached an area of possible resistance - a previous level.  This is probably why the test failed.  Plus, following the failed test the market has literally gone sideways - a warning that this is not a good day to trade, not so far anyway.

12 Points Profit

I was short for time today, which usually means I don't trade, but I took a quick trade and made 12 points profit.  There was News at 2.55pm and the market rose rapidly.  I watched this happening until eventually some weakness appeared in several of the timeframes.  The chart below is the 10 minute, but weakness also appeared on the 15 and 20 minute charts.  The signal on this chart, at Point A, says supply coming in.  The reason for this is because we have had an up-move and eventually, at Point A, the volume has increased and it has closed off the high.  However, this is not enough evidence for us to go short (sell).  We need to see confirmation that there is weakness.  Of course, yes, as is the case, the market falls quite a bit, and I am watching it, but I do not get in.  I wait for confirmation which I see on the 5 minute chart.  See the chart below this one.

On the 5 minute chart at Point A we have no demand (no interest in higher prices).  This alone is not enough for us to enter the market, but coupled with the weakness that has also appeared at this point on the larger timeframes, it alerts us to a possible trade.  The market then falls (confirming the no demand), then at Point B we have another no demand - confirmation.  This is my point to go short.  I took my profit thank you very much.

I have had a very good week again and my aim next is to stay in my trades longer and really rocket the profits.  However, caution is required.  I have found what works, I'm building my account steadily, so there's a little voice in my head telling me "if you've found something that works, why change it?"  So I'm considering carrying on as I am and investing more in each trade for higher gains.  Will meditate on it!

Upthrust + Why To Be Cautious of Market Open

I took 20 points today, short, on the 5 minute chart of the Dow Jones.  See the chart below.  At Point A is our upthrust.  Not only is it an upthrust, it has very high volume (selling), and we have the added bonus of it penetrating an area of resistance, but closing on the low, below that level.

Also see the 1 hour chart below.  This is a good illustration of why we must be very cautious at the market open, and why I would not want to be in a trade before the market open.  The bar at Point X, you would think, is a test.  The programme has put up a signal saying this.  However, beware the volume is not less than the previous two bars, so this means there is some supply in here.  But to the eye, the bar looks like a test.  You may think this will influence the market, but the next bar, which is at market open, is a trap upmove (serious sign of weakness), and the market has fallen since.  So beware trading at the market open.  Because of the volatility it can be very profitable, but it is also very dangerous.  There are traders who do trade at the open, and make good money, so I'm sure it's possible.  But my aim is to avoid too much stress!  If trading becomes very stressful we build a negative association, which is detrimental to our success.