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Archive for February, 2009

What were they thinking?

February 19, 2009 2 comments

I know he’s been on awhile, but I’m not really sure that there is anyone I hate more on TV than Dennis Kneale.  When this guy is on CNBC, to me it is literally like nails on chalkboard.  I know Fox Business came and looted some of CNBC’s top talent (Alexis Glick, Eric Bolling, Liz Claman…..), but when they decide to retaliate, they go after the most annoying guy on Fox’s Saturday Morning Lineup?  He wasn’t even the most talented guy on his show (Forbes on Fox).  Well below is my list of other people I wish they would have hired from Fox’s Cost of Freedom (don’t get me started) lineup:

1.  Gary B. Smith – Everybody loves the Chartman!

2.  The Capitalist Pig Jonathan Hoenig – Recommended Gold way before it was cool.

3.  Wayne Rogers – Dude was on M*A*S*H

4. John Bradshaw Layfield “JBL”- Will put the choke hold on a bear market if need be.

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Trading Plan – Setup #1

February 13, 2009 Leave a comment

With some encouragement from BigBiegs, I have decided to post some of my setups on the blog.  My primary setup is based on Price Headley’s Williams %R trade.  The main purpose of the setup is to help identify a valid trend and then give an entry on a pullback.  There are 3 steps to this setup (this for a short trade, everything is reversed for a long trade):

1.  The Setup – This is identified by Williams %R closing below -80 on a 5 minute chart (on my chart -20 is the top line and -80 is the bottom line – some vendors have this reversed).

2.  The Confirm – This happens when a bar closes below the low of the setup bar.  This must occur within 5 bars.  If this does not occur within 5 bars, the setup bar is negated.

3. The Retest – The retest is identified by Williams %R closing back above the -80 line.  Price will have to rally to cause this to happen.

There it is in a nutshell.  Notice all signals are based on closings.  No decisions are made intra-bar.  Now time to talk about trade management.

1.  The Entry – If price closes within 2 ticks of the high of the retest bar (ie – The bar closes at 825 and the high is 825.25).  Short with a market order.  If prices closes below 2 ticks  of the high, place a limit order 2 ticks below the high (ie – The bar closes at 824 and the high is 825.  A limit order will be placed at 824.50).  If you don’t get filled in the bar following the retest bar – cancel the order.  If price drops by 2.5 pts without filling you – cancel the order.

2.  Stop-Loss – A 2.5 stop loss on all trades.  Once you have reached 2.5 pts of profit, move the stop to break-even.

3.  Target – A 5 pt. target is always used.

A couple of other points.  

1.  Only the first retest for a given retest is taken.  After that all retest are ignored until Williams%R “resets”.  This is caused by Williams%R closing above 60.

2.  Williams%R is defaulted to a 30 period setting.

3.  The trade is taken between 9:30-4:00 est.  When the signal is generated at 9:30 it is considered extremely reliable.

4.  The signal is ignored Williams%R confirms into a 50% fib.  That’s because a retest is only caused by buying/selling from the “Ambush” trade.

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