Do Trendlines work?

OK, this is it for the evening. I need to be sharp for tomorrow.
Take a look at the chart and you can see where price moved to
1193 and reacted.

This is how one "plans" for a reversal trade. You can't be sure it is going to work out, but you can see it before it happens, and get in cheap so that you can participate if you get continuation.

Good luck tomorrow

Lefty
 

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Lefty

Curious why you did not consider a short/add at this point. The test failed but still seemed a good risk to me with a wash as the worst that could happen.
 

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OK, I am long from the open waiting for a test of 1209.25

In response to the question "why didn't I look to add...."

I refer you back to the chart where I show what happened previously at 1193 level. I don't just post the chart after the fact for you folks at ET. I actually PREPARE for the reversal at that level. I look for confirmation and go for that move, since it has happened so many times before (take another look at the chart). I was betting on another reversal.

Good luck
Lefty

Edit:
I will look to take profits on a move below 1206 (10:22 EST now)
 
Heres a chart of the open. You can see that the gap is a good indicator of a continuation. We look for a continuation that is equal to or better than the previous leg (1194-1199).

Attached chart shows the thought process for this simple strategy on the open. Buy the gap, looking for continuation of at least 5 points.

I use a proprietary pivot system that gave me a R level at 1209.25. That was my profit target for the opening trade. I got lucky today.

Hope others have similar luck in the markets.

Lefty
 

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Brought my stop up to 1207 even. Will be flat then looking for the next trade. I would be adding on a move above 1209.25

Cash markets are starting to roll over a bit. In a strong market this is could be a headfake right before another up leg. I am prepared to go either way. I see support at 1206.75. If we penetrate that I would look for a downside scalp of 1.5 pts min

See ya

Lefty
 
Theres a reason why the markets slow down during this time frame. I'm in the futures business, but it is the same in New York. The professionals get off the floor because they have made (or lost) most of their money in the first half hour to forty five minutes. They go upstairs (or elsewhere) and wait for the next time frame (after lunch). This is one of the major differences between commercials and retail traders.

Later
Lefty
 
Homework!.

I monitor the European market before the US open. I look at previous levels. I look at where the US will open (will it gap up or down, what kind of gap). Then I watch the opening 5 min bar.

Today was a gap up. I looked for a continuation. After the first bar I am looking for entry on the open of the second bar with a stop loss just below the open. If we get continuation I am looking for a profit target that is equal to or better than the previous leg (look at my other posts). Once I get some breathing room I am looking to add at price moves up past pivots. I get in cheap and add. This helps me to manage risk, and insures that I can participate in the move when it does go my way. If I am wrong (and I am wrong all the time), then I get out with a min loss, and try to get myself back on the right side. One thing that helps is to not be in a hurry. I wait until I have a setup that I have confidence in.

Good luck to you

Edit:

Notice how the market just sits there right above suppport at 1206.75 (my pivot). This is a strong market, that is dominated by institutions, not retail investors. Big players are the ones who decide whether to mark it up or down now. As I said before, right after the open they get off the floor and wait. If there is a move before the lunch hour it will be on low vol or it will be that programs hit. The second team brokers are told to "go with the flow" until after NY lunch hour. This is why it is so important to have an opening strategy that you can count on. Ok, so this is my good deed for the day, and I am going to take a break. Seeya later.

Lefty
 
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