PLAYING THE MARKET PART 2

Yesterday's blog gave a quick review of some of the setups used to follow the market.  Those setups were used again in today's market.  Please refer to that post for more information.


TODAY:

[07:32] <@Chartmaster> outlook today: bullish nature from lows around 1294. expect the 2nd test to bo. target to break by bulls is 1306 level resist.  extended trends seem to be back in favor follow them..

It did not take long for us to follow the trend.  The longer term bias from four A.M. EST was supportive of long positions.  Bars 1 to 10 area was an inverted  H&S and provided TL touches for long entries.  A temporary short trend developed, but was quickly played out and converted back to a bullish trend for the remainder of the day.

When the short trend ended, a bullish channel developed.  This bullish channel was supported by the EMA and the bullish TL.  Our targeted breakout was 1303.75;  top of the channel, top of bars 16-17, and it would allow us to return to the original bullish TL.

[12:16] <Chartmaster> 3.75 bo of bull channel and bo b16-17  very good for bull

Followed by:

[13:44] <Chartmaster> 10.5 next key bo area (resist) for bull with some pause around 8.25-8.75

Per blog discussion yesterday, play TL touches in a trend.  Play "weakness" (Pullbacks) inside a channel.

At the end of the day, another TL touch was productive going into the target area.  If you miss the original run, wait for the pullback.  In this case, the PB was noted, and discussed as a trap of late longs.  An Entry after the PB would be a stronger position.

[17:03] <Chartmaster> btw there is the pb discussed..

Note the strength in waiting for the PB long, as opposed to those trapped at 11-12 trying to get in the long bias.