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
I am always open to questions, comments, or suggestions on how to improve this blog.

Monday, August 22, 2011

seed waves

Setup this afternoon across many issues.  The importance is having reasonable targets in mind and knowing when you're wrong.
CLF - went long in a REALLY stupid entry ($68.85).  Sat through the adverse move with the opinion that if it held the 50% retrace I would wait it out, and so it did.  Exited the majority of the trade just above (got a lucky pop) the 50% projection ($69.36) for safety sake.  Stopped on the remaining 1/4 position just under $69.

A number of issues were setting up the same profile at the same time.  These 3d setups trigger on the 5-min chart with a fast line going positive.  But if a seed wave has yet to form then it's best to wait for that seed wave before just taking the trigger confirmation on the 3/10macd as you can likely get better Risk:Reward setup around the 50% retrace point (wait for green bar on 5-min at this 50% level).


SPY - notice reverse divergence between previous day's low & today's afternoon low on 15-min chart

There were more, but you get the idea.

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