Catching Tails

[Wide Tailz]

Position is lingering and I almost cut it on Friday afternoon but The Market implored me to stay put.

For your amusement, here is a comparison between BAC and RIMM on the weekly chart. Note the similarities.

 

[Wide Tailz]

..... And the daily chart.

BAC shot thru the 50 SMA and lingered, as well.

This is a creative situation because there is not an obvious swing low to place the stop, after the breakout.

I'm contemplating various scaling in tactics. It's all for the sake of keeping risk below 5% while pyramiding in capital as the tail expands.

 

[ammo]

not a prediction just a supp,6.90-.30 area is a good place to ride the short,the widest spots are the places where the most trades took place,if we drop there are a lot of stuck shorts in this area,half the trades were shorts,break even would make them happy,works in heavily traded instruments

 

[Wide Tailz]

Interesting idea. Thanks for posting.

Regarding the double bottom / wave 3 break thru the 50 SMA on a disaster chart, check this: NFLX

40% potential with conservative triggers.

 

[Wide Tailz]

Position is launching nicely. Stop raised to 14.19 for break even.

 

[Wide Tailz]

. . . and wouldn't you know, less than five minutes after placing the stop, price went straight down to 14.20 (yes one cent above my stop), paused, and straight back up to 14.32. Checked my account and I was filled @ 14.19.

Now I see why daytraders don't use stops, it's like showing everyone your cards. I just never thought I was large enough to attract the sharks. Some floor trader got a hundred bux.

Swing trading typically has stops well below the most recent swing low / horizontal support so it doesn't matter in the short term. Swing trading is like a chess match: all positions on the board in plain sight, but future possibilities are much more convoluted than in a poker game.

So The Market has just taught me another valuable lezzon, but this time the tuition was free: stops shall remain below recent historic demand zones.

 

[Wide Tailz]

. . . And it's printing 11.97 a few days later.

Yay for risk control.

RIMM is now off my Elliot Wave radar as it is now below the expected wave 1 low of 12.40. My wave count has been rendered invalid.

 

[Wide Tailz]

I've been sitting it out this week because I haven't found any good tail prospects.

However, I found this curious tail forming on the top gainers last Friday. I didn't touch it because my mind was on work, but after doing a wave analysis, I think it might be worth watching.

We've got everything: earnings per share accelerating out of the down trend, long term wave count shows some possible upside, low risk price action on the one day chart, etc.

In case you're wondering, pink = buy (because I'm loving the price action), gray = the immovable concrete demand line, green = profit exits, muddy green = notable EW clues, such as how wave 3 never goes below wave 1 top.

It's always clear in hind sight but these exercises help keep my head clear when the heat is on.

Speaking of heat, the blue line is the sell target, when I get to step out of the "hot" seat!

 

[Wide Tailz]

After some light investigation, it seems what's driving the move is a pending FDA approval (or popular speculation thereof) of their drug. Evidently it treats low testosterone with oral methods.

:eek:

Look at the momentum divergence. Even a classic range expansion, right out of trend following 101.

I'm expecting a pullback but there may be a little chunk of the tail left next week.

 

[Wide Tailz]

Greetings.

No wild updates or equity swings to report. I'm still out of the market because the only opportunity has been countertrend (short) and I'm just not in the mood to try to pick off retracements.

This is a good example of why I have chosen the third wave breakout trading method shown here: you simply stay out of all difficult market conditions.

What to do when there is no opportunity? Check the top gainers on the scanner every morning at 10 minutes after the open. I've been studying these creatures of volatility and they are all impulse waves - all with a low risk third wave in there somewhere.

Here was one this morning. I didn't touch it because I'm still studying the risk / reward stats of this type of setup. Every day there are a few low risk setups when these stocks pop on news, etc.

Three setups on a single day, roughly $1.75 per share potential with R multiples in the 3-10 range.

But no wild equity swings. Still up only 6% for the year.