Thursday, May 01, 2008

Thursday Qs

First day of the month and hope springs eternal. I meant to buy the close yesterday, but had a few errands to run and didn't return until after the close. . .so my loss. The parabolics firing in the last 30 minutes Wednesday was a pretty good signal for today, but you never know what's going to happen after the close (earnings and other surprises), so it becomes a matter of finding a comfortable risk level, and if you've read this blog for a while, you know mine is pretty low (probably from watching the El Churro video too many times).
Just one trade today as I was in a bit of a funk and not really in the mood to trade.
However, with the parabolics on a steady rise and the 10/20 cross at 9:45, my interest picked up. Generally, when the Qs break above a resistance pivot (in this case PP), and progress at least 25% in the direction of the next pivot resistance (R1), it's a good bet it's going there. Once I got that confirmation at 9:55 I went long (47.60). The action in the NYAD gave me some second thoughts, but the main Qs indicators still looked very strong, so I dropped a .10 stop on the position and stepped back. The Qs blew through R1 at 10:25 and the NYAD was again stumbling so I raised my stop to 47.72. With the failure to retrace below R1 and the surge at 10:50 R2 seemed like a real probability. The parabolics and the 10/20 confirmed the move up and with the Qs chattering against R2 resistance from 12:35 to 13:00, the NYAD flat, the NYAD signal line heading down and the TICK heading down, I closed the position (48.40).
Time in trade: 3 hours, 5 minutes
Trade gain: .80
The markets continued up into the close and this may be the start of a multi day surge, often seen the first few days of the month.
However, I'm flat and not in an investor mood as the markets move into significantly overbought territory.

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