This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

I started out today like yesterday, trading well and making my little bits of money. Then I did something dumb and it all went to hell after that. First my good trades:

AMZN Short. After the big upper tail, I thought it would fall back to the 5-ema, and it worked out as I expected:

Here’s a Heikin-Ashi Tick Chart. I thought it did a good job of showing trends and I watched a 100-tick chart alongside my 15 min today to help me see trend changes. I’ll keep watching them in the future:

MA Long. This set up as a good Trader-X “beyond the fib extension” trade, though I got stopped out at breakeven and scratched the trade:

Then, I got the bright idea to go long RIMM and hold into the Fed. WTF was I thinking? I thought I could get out quick if I was wrong. Think again:

A quick -4R. So much for my good trading these last few days!

I scalped AAPL long after that and made about a third of that loss back. We bounced, printed a green candle, and I went long when the tape started to surge at 191.50:

Then I took a shot on scalping GS Long, small position, but top-ticked it and lost -1R:

Then I went crazy! I went long VMW for a swing overnight at 96.01, got scared and sold it at 95.60 when SPY broke support. Then I went absolutely out of my skull and bought FXP at 73.85 and I’m holding it overnight.

All in all, I was down about -2.5R on the day. It was so easy to trade AAPL after the Fed, when people were dumping shares! I think it was Teresa Lo who said it’s less risky to trade in crazy circumstances like this than in calm markets, and I think that’s true. I just had to walk in and pick up the money. People getting out at all costs (like I did in RIMM) created an opportunity. There is a huge edge there–it’s like waiting until all the cards are out on the table before deciding whether or not to bet! This is the best way to play the Fed, and the only way I will play it from now on. It makes no sense to gamble on the news like I did. When you have no idea how the coin toss will come out, you might as well just flip the coin and give the money to someone else if it falls against you. There is no edge there, and it shouldn’t be traded. This is a new rule for me now. I will always be flat going into Fed announcements or other big news events.

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

I traded a setup in Amazon.com, Inc. (NASDAQ: AMZN) today, and I already posted about my mistakes. I wanted to post an example of the type of setup that I should have taken. It’s similar to the AMZN setup I traded, but there are subtle differences.

Skyb0x on Wallstreak caught 6+ points in MasterCard Incorporated (NYSE: MA) today, so I looked at the setup that was present this morning. This is what I saw:

There was a big move upward, and price retraced less than 38% of the distance from the morning high to the open. It consolidated with support from the 5-EMA on lower volume. From there, it broke out again on high volume, reaching the 38% extension and beyond(!). No way would I still be holding now, but what a run! And it’s a perfect example of the setup I was looking for.

Here’s my flawed AMZN setup for comparison:

Similar, but see the difference? There was a big move upward, and price retraced more than 38% of the distance from the morning high to the open. It broke support from the 5-EMA on lower (but still above average) volume. It was a deep retrace, and the 5-EMA being broken indicated that trend was unclear, rather than a consolidation for further uptrend. I shouldn’t have taken this setup in the first place.

I never really formally thought these things through ’till now, so I’m writing them down here. I’ll look for the elements in MA (38% or less retrace, 5-EMA support) in my setups in the future. Thanks to Skyb0x and the Wallstreakers for bringing MA to my attention!

All right, somebody else can have MtM now for a while.;)

Stocks Mentioned In This Article
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AMZN	| |
MA	| |

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

Zoomie made one trade today. I made none… in my entire list of 169 watchlist stocks, Trade-Ideas told me only one had an unusually high volume ratio (which I define as 5x). Weird…

Anyway, Zoomie got some nice profit on Mastercard (NYSE: MA) today. Great way to start the week! Here’s the chart with his annotations (click to enlarge, as always):

Stocks Mentioned In This Article
Stock	Links
MA	| |