Daytrading Course
Learn to Read the Tape
Exploit Pit Pivot Points
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PIVOT MAGIC TRADING JOURNAL - EXCERPT

Good morning and a good week,

We clipped a couple of decent bites on Friday. In spite of all the traps,
Pivot Magic Trading Money Management rules kept our powder reasonably dry,
permitting only a couple of breakeven or tiny-loss scratches to mar our day.

What's in store for Monday? Stay tuned!!!

The market has plunged over a very significant precipice.
A Red Flag warning remains in effect.

E-mini
Friday Dec 12, 2008

Day session opens gap-down at the S2 and climbs to return test the S1.

1 = What looked to be a Bear Doji Sandwich Reversal converted nicely to give us a Second Chance to join the
ongoing move, a 123 continuation (a PMT "S" Signal) through the S1.

A = DVS (pink arrow) drives a large white Spinning top. Not only do we get pulled in on this depressing
candle (initial stop advances under the S1), but most of us SCRATCHED when Price Action retraced more than
2-2.5 points.

B = Even if you let it ride, you fared little better:

1. Large white candle through the MA. Per our stop rules, move the profit-locking stop under the MA.

2. Next candle is a:
* Slightly Higher-High-Turns-Red
* 3rd failure to overcome Resistance at yesterday's Low
* 2-bar Reversal (by around 884.00 Price level)

3. That leaves no choice but to SCRATCH.

2 = Double-bottom pattern Reversal through the S1 kicks off with an inverted (Bull), red, Dragonfly off the S1.

C = Pulled in on giant white candle, with initial stop advancing under the MA (and jumped to "free trade" by the
close of the candle). Resistance at the Low is again tested, as this giant slams to a halt.

D = Distinctive DVS (pink arrow). Late in the move, this is definitely a sign of failing Momentum. Large white
candle through the Low. PMT stop rules advise, move the profit-locking stop under the Low.

E = A 123 retest of the Low, and the Bulls squeeze out yet one more large white candle, which falls short of
closing the opening gap.

Flat topped candles very often indicate the death of forward Momentum. Prepare to exit briskly if one of our
Exit Now! signals displays on the tape, or to Pivot Scalp exit if by some fluke the Close get touched.

NOTE: The position is in violation of Pivot Magic Trading Maximum
Profit Giveback rules. Normal PMT stop placement, under the low of
the candle, leaves the position in violation. In light of the Exit
Now! danger, a mental stop at Giveback level is a doubly-appropriate
choice.

Exit Now! as the next candle retraces 62%. +/- 7.50 points

[SNIP]

4 = Wow! A lovely Head and Shoulders through the Close. Not only is the opening gap now closed, but this pattern
also is surely a self-confirming triplet. Completing with a 123 retest of Resistance at the Close, the signal
pulls us in on the large red Bull Dragonfly.

NOTE: Both the minimal Bull Volume (pink arrow) and Price Action,
versus the healthy Bear continuation Volume, combine to lessen the
urge to jump ship as the tail of the large red Bull Dragonfly
gobbles up the profits.

F = Large red candle. Per our rules we'd move the profit-locking stop above the high of the candle. Personally,
following the post-entry scare, I'd drop it down to "free trade" (Good ole risk-conservative me).

G = Large red candle closes sitting atop the Low. The influence of this usually benign Historical S/R PL is
quite pronounced today! Move the profit-locking stop above the high of the candle.

H = Large red candle. Per our stop rules, move the profit-locking stop above the high of the candle.

Two longish bottom wicks in a row may mean Momentum fadeout.

Two candles later the tape displays a mid-air white Bull Dragonfly reversal. That's one of our Exit Now! signals.
+/- 7 points

5 = Well, well, what have we here?!?

* Bull Twin Towers (dark blue arrows) says, "Now Price Action will stall/sag/retrace."

* Black Volume Bar of Death (pink arrow) and Doji spike warn, "Reversal is likely in process."

* Tail of Red Bear Dragonfly completes the final gesture, spiking through the Close before
heading south. This, finally, is a "P" signal, clinching it.

We are pulled in on the giant red candle, which BTW stopped cold against the Low, once again. MA penetration is
a small, so personally I'd take the risk-conservative (of course) opportunity to jump the initial stop directly
to "free trade".

J = Large, red, Bull Dragonfly candle. Series of candles with lower wicks indicate that Momentum is lost, with
Price Action testing and retesting the Low, top and bottom. Most of us exit as Price Action stretch falls just
short of the S1 and gives back >2-2.5 points of our profits. +/- 7.75 points

Otherwise, factoring in the Twin Towers (pink arrows) stall/sag/retrace indicator, the instant the next candle
shows white we have a PMT Exit Now! signal and briskly exercise the order.

6 = Although this is a DVS-based signal (and thus suspect for longevity), the Primary Objective (Close) is both
profitable AND nearby. With the plunger pulled way back for a slingshot of the MA, it was reasonable to anticipate
the large white candle shooting through the Low, pulling us in, and inching through the MA.

K = Failed test of MA. Per our stop rules, move the profit-locking stop under the MA.

L = DVS (pink arrow) drives a large white candle through the Close. Though most of us jump as Price Action
reclaims 2-2.5 point of our profits (+/- 7.25 points), the rest of us snuggle the profit-locking stop under the
Close and hold tight, even adding contracts as Price Action bounces with a 2-candle 123 "S" signal.

N = DVS (pink arrow, that makes it a Twin Towers stall/sag/reverse indication Volume pattern). Pivot Scalp exit
as Price Action spikes through and returns under the Pivot. +/- 13.25 points

The day peters out with a zillion traps.

PERSPECTIVE
(Daily, bottom chart)

Again the BBs continue to prefer trading inside the security of the LT SW Channel
(lavender channel lines). Hard to tell if that long-tailed Bull Dragonfly day
candle represents Bulls fortifying for an assault, or Bulls gasping, exhausted
from trying to hold trading near the top of the LT SW Channel.

REMEMBER: Trade the tape, not my prognosis!

Asher
=] ;-)>
Pivot Magic Trading Course
http://www.tradingthingys.com/PMTJ/Commodity%20Day%20Trading.html

Friday's PMT Chart: