Yesterday was a nice down day for the markets and provided good action for short sellers.The QQQQ trend to me was quite obvious...down. When you see candles like this they provide great opportunities to initiate new shorts or add size to current positions.
If you are wrong and get stopped out, the losses will be small. If you are right , your position is never threatened and you have a jump on the herd.
Later in the day you can see what happened to the QQQQ. The trend continued down.
2nd yellow line marked big volume coming in which is another place to add size as it moves under mid day support.
Use this data from the overall markets in concert to show you the way to trade indivdual stocks.
5 comments:
Were you trading the Q's yesterday? Or are those your S/R lines? Do you generally use the wicks for S/R?
dtf- no i wasn't trading the Qs, i dont think I ever have.
these are just the S/R lines I put on the candle bodies not wicks
okay, i want to pick your brain. i'll apoligize for the confusion to ensue.
so the 11:55 green candle on big volume was a fake out which a few weeks ago, may have got me long, but i think i am learning. the 1:55pm big volume red bar lead to lower lows but, could that have led to a fake out as well? whats the difference on the 2:55 big volume red. is it that the candle hammerered? that the 1:55 and following candles never threatened to go back up (lower highs)? or that 3:05 finally did break the high of 2:55 ending the downtrend?
i did go long near the bottom around 3pm, because it just felt like exhaustion. no more sellers left. i can't recall my gut was saying around 2pm.
j- the 2:55 as indicated by the 2nd yellow line finally was the one to break the support level 43.79 that it had tried and failed to do 4 times earlier that day with good volume. That is significant.
A break of support on a weak day means that you should pile on the shorts.
Notice that I drew the 43.79 support level on hours prior and that it held to the penny hours later.
It's not a coincidence the lines match up.
I honestly don't really know what a hammer candle looks like and so don't debate with myself "is it or isn't it"? Really I don't know all the candlestick names.
The length, the speed it moves, dojis are what I pay attention to. But the support or resistance levels are vital and I establish those throughout the day as new highs or lows are hit.
the 2:55 i was referring to isn't even on your charts, sorry.
i am starting to see what you are saying when talk about the length and speed of the candle.
i don't think it was too long ago that you had mentioned about the support and resistance lines that you draw. ever since then, dtf and i have being employing that tactic. its amazing the action that happens around those levels. thanks for the insight.
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