In that vein, in the spirit of Jack Hershey, I decided to start collecting my thoughts on yellow legal padz. The latest candidate list. You have to do this when it costs you 3 days on the bench, every time you make a play.
MASSIVE gap down open and slow meltup of just about everything today! The only stock on my list that did not fall in step was RPRX, which has little institutional ownership (yet). And how about this for a top call: "The NY Fed on 'the phenomenol' asset that is gold" http://www.zerohedge.com/news/new-york-fed-phenomenal-asset-gold Lots of bad newz out there between Europe and US corp. earnings, and the overnight liquidation of the ES sure looks like an impulse wave.... which could mean a breakdown from the rising wedge is next. I've got my eye on FAZ.
On the chance that The Market is just shaking out suckerz, here is a potential bullish third wave setup for BZH. I have no idea why a home builder stock would launch during these economic conditions, but the setup is there. BZH has a special place on my yellow legal pad of wave makers. It gave an eye-popping back test with a simple trend following algo, so the signal to noise ratio is very good.
NFLX got seriously smashed after hours today, following earnings. Had I continued to fade the corrective wave, I'd be down 13.5%. Outch!
I hope all you Elite Traders are enjoying the price action today. I have discovered something that I wanted to share with any struggling daytraderz: I spend my days paper trading while I wait for a good third wave setup on the hourly / 15 minute chart. I use this time to let loose and express my every impulsive desire on The Market. I've been noticing a pattern: I dig myself into a big hole during the first half of the day, buying anything on the 1 minute chart that is going up. It's as if I'm just trying to keep myself awake, and avoid boredom. But after I buy, it promptly goes back down! It does this almost every time. It's as if The Market is psychic, and trying to get my money. I typically cut losses at the bottom of the range, before it goes back up. Then, after several hours of getting smacked around like this, I realize the futility of my impulsive behavior. Humbled, I go back to the third wave breakout setup, which requires the opposite of an impulsive state of mind, and get back slightly above even. This pattern has repeated for several days. I present this little story for anyone who may be wondering why The Market keeps wringing money out of their account.....
Greetings, market participants and spectators! Today was no different. I dug myself into a big hole paper trading, then found a third wave brewing on NFLX, piled in, and kachingo - in the black. One of these days I'll get the impulsive drive to pounce on whatever is moving, out of my system.
What's up, trend stalkers? Another day of paper trading the third wave..... Four wins, one break even, no losses. Today I deliberately forced myself to wait for the first higher low and / or continuation pattern before jumping in. This is my natural tendency with real money on the line, but in sim I have difficulty holding back from trying to pick bottoms. The third wave is for real. It's like learning to wait for the phat pitch before swinging the bat. As an aside, look at that beautiful rising wedge on the ES.
BZH setup getting close. Triple bottom on the .618 fib line, trendline breakout, now I wait for a higher low. The markets are unusually strong. That "rising wedge" was another illusion. If I was in the business of fading corrective waves I'd have been impaled!
FAZ looking coiled. The Market appears to be waiting for something to trigger it....... a reality check, perhaps, from the CB's later this week.