Recently we switched the format of our Real Time Room from exclusively daytrading ETF's to daytrading of individual stocks. We have decided to start a journal here highlighting some of the plays that may have educational value. Those of you who are familiar with our other thread "Why Actively Trade ETF's" will be familiar with the style of trading. Essentially we trade relative strength. We use a top down approach, to analyze what the broad market is doing first, then find out which sectors are strong or weak relative to the broad market. Trades are then initiated in the direction of broad market and/or sector strength or weakness. Generally our style is low-key with no more than 3-4 trades on an average day. Today we noticed that as the broad market was chopping around within the first hour, the $OSX (Oil Services Index) was basing at its lows and was showing relative weakness to the broad market. The following two charts illustrate this divergence: As you can see from the two charts above, the Oil Services Index was showing relative weakness to the broad market at around 10:15 this morning. A scan of some Oil Services stocks brought our attention to Baker Hughes (BHI) as a short setup within the sector. We entered BHI on the short side from 29.14 in the circled area above. A physical stop was placed at 29.25 just over the 50ma. Our first target was the whole number 29, where there was some intraday support from yesterday as shown by the black line to the left. After covering half of our position at 28.97, BHI experienced further weakness and fell down to its 200 period moving average (blue line). We covered the rest at 28.78 due to the support of the 200. We find the 200 period moving average to be extremely powerful on ANY timeframe. As you can see from the price action following the test of the MA, BHI used it as a springboard to recover some of its earlier losses. We were out with an average gain of +.26 on the whole position. This trade is indicative of our style of play intraday. For the sake of brevity, subsequent posts won't include snapshots of the broad market and sectors. We'll just post annotated charts of the individual stocks themselves. Intelligent commentary on daytrading relative strength is always welcome.