|
|
| |
|
 January 14, 2004
Commentary-
Today I'm going to show a trade that I found
in the ES on the 3-minute chart. It's been a few days since I've referred to my
favorite trading vehicle on my favorite timeframe, so I figured it was time to
'revert back'. I'll start with what I was looking at on the 3-minute chart,
just as the afternoon session was about to start.
I saw a small ABCD pattern start to form, and
as it was I was looking for an opportunity to get long. The larger timeframe
trend is still markedly up at this point. That may change at any moment, but
right now it's still up. Let me highlight the pattern.
This was particularly attractive to me based
on something I've shown more than a few times in this column. Let me add a
horizontal line onto the chart to show what caught my attention.
I noticed that there was an alternate variation of the
ABCD that completed right at the low for the regular trading session. I have
seen buyers come in at this point many, many times since this bull run has
started. I watch for this every day.
Not every trade has to have a full confluence
of Fibonacci numbers or an awesome looking pattern for me to consider a trade.
Sometimes the overall context and the placement of the pattern are enough for
me. Don't overlook the simple. Even so, there was a fairly nice grouping in
this area. Let me add this onto the chart.
I only used one internal retracement number from the run
up to add to the grouping. There is a .382 retracement just under the grouping,
but all in all the placement of the grouping is not particularly harmonic. In
this case, though, I liked how the numbers lined up from within the pattern and
near the pattern, and I had the low of the day observation in the mix.
I opted to
play this one if I got an entry signal. Not all plays have to be 5-point
patterns or exceptionally harmonic setups. I weigh in other factors in many of
my trading decisions. Let's see how this played out.
I got a classic entry trigger and couldn't have asked
for more with the move. As usual, I scaled out at various points as per my
trailing stops/scaled exits
plan, closing out the last bit right before the close.
The plan I
use here is very similar to what I'm using with the current VTSS and FDX daily
timeframe plays. The only significant difference is the shorter time that it
takes for the exit points to appear. If I looked at some of my plays
anonymously, without the timeframe on the chart, I likely wouldn't be able to
tell if the play was on a daily chart or a 3-minute chart in many
cases.
Keep an eye on FISV on the lower timeframe. It's starting to
move.
|
|
|
| |
|
|
 NOTE: Reading this page or any page on the Kane
Trading website, or utilizing this website and any material
contained herein in any way, shall constitute an acknowledgement
that you have read, understood and agreed
to all the
disclaimers,
terms & conditions, and
policies of this site.
|
|
|
This website is best viewed with
MSIE 6.0, text size set to medium, and screen resolution set to 1024 by 768.
Copyright © 2003 Kane
Trading. All rights reserved.
|
|
