BS"D

Good morning,

We either paid for the day, or profited nicely on Wednesday.
One possible Scratch and a few dangerous traps.

Looking forward to Thursday!

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DAILY

PIVOT MAGIC TRADING JOURNAL - EXCERPT
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E-mini ES H0
Wednesday January 20, 2009

1 = Wednesday morning opens gap-down with and Anomaly at the S1. The S1 is also the new LT Trend
Channel Floor (Daily, bottom chart, green dashed channel lines). Since the next candle is a Doji,
and Volume drops, the Floor test makes this very questionable and risky. If you entered below the
S1, you SCRATCHED immediately.

Price Action tapes a 123 Continuation "S" Signal at the S1/Channel Floor (blue arrow).

A = Volume picks up, and we are pulled in on a large red candle. Initial stop advances above the S1.
Price Action stalls, and we convert to a mental stop just in case.

B = Large red candle. Per PMT stop rules, move the profit-locking stop above the high of the candle.
The long bottom wick is worrisome to experienced PMT readers of the tape.

C = Large red candle puts our position in violation of Pivot Magic Trading Maximum Profit Giveback
(MPG) rules. Mental stop at Giveback level.

NOTE: The ABS is very bloated today, so Giveback
and stop placement may be expanded.

The next candle (white) tapes a mid-air Reversal, Exit Now! Signal. The next candle (Doji) gains no
ground, and the MA has well contained the morning Price Action. Advanced, experienced, traders held
for this stall. (Risk-conservative Beginners wisely exited. +/- 3 points)

D = For those who braved the stall, when the large red candle eases through the newly formed LT SW
Channel Floor (Daily, bottom chart, light blue lines), violating MPG rules, a mental stop at Giveback
level is in order.

E = Again, we are in MPG violation. Calling this a second red candle closes below the Channel Floor,
move the profit-locking stop above the light blue line.

F = DVS (pink arrow) blasts a giant red candle through the LowW to the S2. Per our stop rules, move the
profit-locking stop above the LowW. High likelihood that this desperation exhausts Momentum, so use a
mental stop.

G = The next candle, red Bear Dragonfly, penetrates the S2. Twin Towers (pink arrow) tells us that a
stall/sag comes next, so move the profit-locking stop above the S2.

We are promptly taken out at the stop on the next candle. +/- 7.75 points

NOTE: So close to lunchtime, there is not enough Volume
support for the Signal off the S2 to permit us to Reverse.

Lunchtime sideways drift ensues, with Price Action trapped between the S2 and LT SW Channel Floor (light
blue line).

2 = Very wide Double Bottom off the S2 re-enters the LT SW Channel. Volume is too paltry for us to enter.

3 = Stretching the imagination a bit, this double tap might be an "S" Signal, but the Volume (pink arrow)
is still way too low and non-committal for us to enter safely. Shut down early and find a friend in need
to help.

Pretty much a Doji day-session as Price Action closes EOD back at the S1.

PERSPECTIVE
(Daily, bottom chart)

Wednesday taped a large red day candle, testing both the new LT Trend Floor
(green dashed channel lines) and the LT SW Channel Floor (light blue channel
lines). Overall, Price Action is still sideways, remaining securely in the
middle of the larger LT Trend Channel (solid green channel lines).

The BBs are poised to profit from any blip in the news. Bullish or bearish,
we are soon going to be trading a breakout! Be prepared.

REMEMBER: Trade the Tape, Not my Prognostics!

Asher
=] ;-)>

Pivot Point Daytrading Course
http://www.tradingthingys.com/PMTJ/Commodity%20Day%20Trading.html

Wednesday's PMT Chart: