This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com
Trader-X had an interesting play with BIDU. It gapped down with the rest of the market, and rallied all day.
I’m not sure why, but when a stock (or futures contract) is trending, it bounces off the 45 degree trendline with amazing frequency.
I used a 10 cent box with a reversal setting of three.
This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com
May 30th, 2007 at 5:28 pm
So, in this case, I guess just after the 10:17 dip to the trendline would be an ok, entry, when it made a new HOD. It’d be like 133.20 with a stop under 132. Would have worked out ok, R-wise.
Looking at the chart after the fact, it’s clear you could hop on the trend with a tight stop all day. But, during the day, any time after 10:17 I’d be worried about another plunge to the trendline, I think.
May 30th, 2007 at 5:36 pm
this is the same as any other trendline or moving average…sometimes it works, and others it doesn’t…i’m just posting charts that X and Maoxian highlight, and see what happens
personally, i’ve come up with some ideas on how to trade the pnf charts that are different than the methods i’ve read…the standard methods work great when the breaks follow through, but are unreliable when they don’t…the same as any other setup
right now, i just want to see as many charts as possible, and see what comes up…i’m not expecting to actually try this :-) except me, that is
May 30th, 2007 at 5:37 pm
i meant to say that i’m not expecting anyone to try this…except me
May 30th, 2007 at 6:02 pm
yeah, I get it, I was just looking for what kind of entry I could possibly take against this chart.
May 30th, 2007 at 6:10 pm
btw, the reward:risk would be a hell of a lot better than ok :-)