BREAK OUT DAY

Yesterday we discussed the two days of narrow ranged, cosolidation that was in the market and how this would resolve itself with a break out.  That break out would offer excellent extended, trend trades.

We got our wish.


PRE-OPEN


A pullback to the EMA can offer a quick scalp.  A break of the EMA is positive, and you would look for a quality pullback to enter the developing trend.  The first trade was for 1/2 point.

The story behind the story.

[09:18] <Chartmaster> hit resist  out .5
[09:18] <Chartmaster> they will try again

albeit the trade was for 1/2 point, the market was telling us that this area of resistance would be tested again, and formed our long bias for the day.

THE OPEN

Bar 3 was closing and the comment was made:

[09:45] <Chartmaster> b4  5m reversal
[09:48] <Chartmaster> take 2 at 84  tgt ema
[09:57] <Chartmaster> +4 bal out

The call was made; out in the open.  This was a TR to the EMA and a valid trade to extract point(s) from the market.  We also had the strong BO point in play.  Break outs at key levels tend to be strong and very profitable.

Additional trades included the MAXT which turned into a quick double bottom test.  Tops and bottoms can be tested over time, or in a quick, few bars pattern.  "Batman" is our humorous name for a quick (few bars) top/bottom test that creates a sharp pointed run similar to the ears on the Batman mask.  This test (mini in size) was followed by a CMA play.

The CMA is a favorite trade.

We also like cross confirmation in the charts (CC).    When a setup develops, be prepared to act.  Sometimes that action is after other traders fail at the expense of the market.  The market is always right.

Using the CC,  we let the 5t PB work to our favor, then entered the CMA (above) for +3.

[11:56] <Chartmaster> 3m 512t 5m 8m  range   all at cma area
[12:00] <Chartmaster> hit 5t from 5m 89  512t l(ong) the 200ma
[12:00] <Chartmaster> take them out, then we enter..
[12:02]   XYZ    what do you mean by hit 5t.. hit 5 tick failure/scalp?

[12:04] <Chartmaster> traders entered b26-28 5m thinking long w rising pa  pros(mkt) will pb 5t to take those w small stops
[12:05] <Chartmaster> set +1 and be  automatic..
[12:05]  XYZ   I get it ... bears that scalp entry at 89 exit at 5tick (1 pt profit) and provide fuel for up move...

Remember the strong BO points mentioned earlier?

[13:19] <Chartmaster> remember those BO points bias is long

 After consolidations, look for the BO with extended moves.  We remembered for a +5 gain.

POST comments today from #chartmaster.  Othernet Mirc