The setups I include on this blog are used in conjunction with the 3/10macd and the criteria I ascribe to it as a way to alert me to an existing condition of price. The key concept to take away from this blog is that I try to anticipate what will happen on the higher time frame by using a faster time frame to trigger the trade setup. I do not trade a "system" I use two indicators to clue me in to price conditions. Please read the Disclaimer located in the sidebar of this site. I can be contacted via email at email@example.com
I am always open to questions, comments, or suggestions on how to improve this blog.
Monday, April 13, 2009
Some Resistance Becomes Support instances today. The SPY gap down this morning consolidated at R1 for a good half-hour. A break of the opening range came in the form of an NR7 (purple candle, on the 5-min chart below), followed by a WR7 (white candle). Price stopped at the previous session's resistance level (followed by a harami candle setup AND a "First Cross" short entry). The falling wedge corresponded with a consolidation around vwap (complete with momentum divergence). Price tested resistance again, broke out and consolidated at new support. The previous session's highs was the next range to go. Price closed the day right around Firday's highs on pathetically low volume.Our 15-min and 60-min chart highlight the RBS (resistance becomes support) concept even more clearly.