I did manage to take a couple more trades. Straight scalps. The last one I just left as a bracket order while I went to town to run some errands. I was betting we would have a higher close than on the prev day (26th) and my profit target for the last trade #4 would be reached while I was gone. It was and I exited trade 4 with a profit.
In summary, 4 trades taken today. Trade 1 was averaging down betting price would trade back up enough for a profit before the close. It did in about 1.5 hours after the open and I took profits. Trade 2 was a straight 2 point scalp taken about 25 minutes after trade1. Both these trades appear on the chart above. Trade 3 and 4 appear on the snap shots of the charts below that were taken after
the close. Trade 3 was a straight 3 point scalp. Trade 4 was a straight 2 point scalp. So, 4 trades. All profitable. A total of around 10 points captured counting the first trade.
Points of interest:
1) Daily chart supported today 11-27-2019 (on a 5 minute chart) being a Small Pullback Bull Trend from the open. This is good for me in
terms of utilizing averaging down techniques on PB’s OR holding a position all day and adding to it on PB’s then exiting near the close. I personally prefer exiting as the market gives me profits and entering again long on PB’s. For me that is just locking in profits. While the odds are lower that we could get a reversal from a SPBL trend (from the open)... but a trader should, IMO, realize that there is a 40% chance that such a reversal could happen. So, I prefer just jumping in and out paying more in commissions but locking in profits. It is just a personal preference.
2) The daily chart can be useful helping a trader decide the odds of what kind of day we are
likely to have. The daily chart showed 32 bars staying above the 20 EMA...minor daily PB’s ....tight bull channel ...no exhaustive bull bars during these 32 bars....basically a SPBL (small PB Bull Trend) too but on the daily chart. These type of trends are actually some of the strongest trends albeit volatility may not be much. Just grinding up. Strong..strong.
Usually PB’s are minor in these types of trends. Note the 4 bull bars in sequence just before today’s (27th) daily bar came into play. This too indicates a Higher close on todays bar by the end of the day than the close of the prev day i.e. the 26th.
3) Based upon the above concepts I was willing to trade on the opening bar and adding to my position by averaging down because the daily chart indicated a
high probability of a higher close by the end of today price action (27th). So, I was not looking for a reversal but only a possible minor PB where I could add to my position. You may ask why not wait and go long as the PB ends and go all in instead of averaging down? I would reply “what if there is NO PB but price just rockets on up after the gap up open?” See, by taking an initial position I, at least, am in the game for some profits and if there is a PB (like there indeed was after the opening bar) then I just have an opportunity to buy more at a cheaper price and wait for the trend to resume.
