This is to illustrate why watching the clock is vital to your success as a momo trader.SRS was in strong uptrend, started to stall then drop.
The smart play was to sell the long, take profits, then short it.
Watching the clock you will notice that when the red candle finished on the 5 minute, it immediately went green again almost to the second. That is why I think the 5 minute charts are superior to using any other time frame. Don't think you are missing out on opportunities by not using the 1 minute. There is too much "noise" and the picture is never clearly clearly framed. You will find that many opportunities like this present themselves everyday. A quick turn and the original trend continues.
I believe that taking this quick opportunities is better than seeing $.90 of your unrealized gains disappear.
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3 comments:
Hi - This is an old post, but I found myself scouring your blog this morning and had a couple of questions: are you talking about the 14:15 uptrend and the subsequent long candle down? I am guessing that the 'turned to green' moment is right after the long candle? The bar is too short for me to make it out.
Also - just curious - are there days that you just don't trade? As in not enough action in the market to bother trading?
Thanks for any insight.
DTF- A very important technique to me is trading the quick reversals and I have found that changes occur right when a new 5 minute candle appears. It's a good place to take profits and change the direction of your trade. I've seen it happen 1000's of times.
Depending on the weather and snow conditions I'd rather go skiing, climbing, kayaking or mountain biking instead of trading.
LOL! That is the kind of answer I like to hear! You live in an incredible part of the world. Heh - I wish I would hurry up and break thru this learning curve already.
Before I got your answer - I noticed this happening today. Trading volume seems to slow down, and the start of the candle seems to predict the rest of the bar on big move reversals. Aha - that is what he was talking about. Kinda cool.
And if I haven't said it enough already - thanks for taking the time to blog and answer questions. Invaluable.
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