DAILY PIVOT MAGIC TRADING JOURNAL - EXCERPT
Just as we projected in yesterday's Daily Pivot Magic Journal,
PERSPECTIVE section: " . . . Thursday Price Action will tap
on the Channel Ceiling and return to the Floor."
We took a couple of decent bites on the way down, but following
our Money Management rules, the zero net change day left us
mostly safe on the sidelines.
BEWARE OF TRAPS ON FRIDAY!
Enjoy and be well,
E-mini ES Z0
Thursday October 21, 2010
Session opens gap-up with a test of the LT SW Channel Ceiling (light blue line)/re-enforced R1.
1 = Second Ceiling test succeeds, with a high-Volume (pink arrow) 123 through the Ceiling. We
enter aggressively. At the close of the candle, move the stop to "free trade" plus a tik.
Price Action stalls, and over the next few candles we bail out, with a point or so profit. So much
for nice starts!
2 = Price Action hovers for an hour, and dives for the R1/Channel Ceiling. That's a 2-candle 123
into the LT SW Channel.
A = Pulled in on what turns out to be a rather weak red inverted (Bull) Dragonfly.
The Late-in-the-Move DVS (pink arrow) does little to encourage us, but the stop is adjacent, above
the light blue line, so there is little to do.
B = DVS (pink arrow, Twin Towers?) blasts off the underside of the LT SW Channel Ceiling for a 123
(add contracts briskly), and dives through the High. Our position in PMT Maximum Profit Giveback
(MPG) violation. Mental stop at Giveback Level.
C = Pre-lunch Twin Towers (pink arrow) indicates a stall/sag/retest is next. Move the stop above
the high of the large red candle. Make it a mental stop to facilitate quick exit if the stall is
The next candle retraces >62%, which is a PMT Exit Now! Signal. +/- 3 points
Lunchtime Sideways drift sets in.
D = Sudden DVS (blue arrow). Is this a Bear TELL?
3 = Guess = D was aTELL! Volume is strong on at 123 through the Close. No Price Window to the
Pivot. No entry.
This (blue arrow) 2-candle 123, however, 0signals an aggressive entry. At the close of the candle
our position is already in MPG violation. Mental stop at Giveback for instant locked-in profit.
E = Small gap and a large red candle. Potential Twin Towers DVS pattern (pink arrow) warns of
possible stall. Mental stop in the gap (per my convention). Stand ready to exit briskly in case.
Lower-Low-Turns-white for a large white Bull Dragonfly mid-air reversal. Exit Now! +/- 3 points
Price Action tapes a swinging trend back up to retest the Pivot.
4 = Last minutes for a PMT entry and the tape presents a 123 through the Pivot. Volume jumps
(pink arrow), and we enter aggressively. Move the profit-locking stop under the Close.
F = Exhaustion gap (not good!) and a healthy white candle. No rule, but experience suggests
slipping a stop into the gap.
Next (red) candle retraces >62%. That's an Exit Now! At least we got positive slippage.
+/- 2.25 points
Price Action again turns sideways to EOD back at the Close.
(Daily, bottom chart)
Thursday's large white Spinning Top Doji spiked the LT Sideways Channel
Ceiling (blue line), but returned to mid-Channel for the rest of the day.
Channel Floor test is likely due on Friday.
BE PREPARED FOR ANYTHING, AND GUARD YOUR FUNDS!
REMEMBER: Trade the Tape, Not my Prognostics!
Pivot Point Daytrading Course
Thursday's PMT Chart: