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.

Tuesday, October 16, 2012

Tue. 10_16

An open where an indicator may not be very useful.
However, it can be helpful by looking at the big picture.  The chart below is a 5-minute SPY chart with 24-hour data.  The settings for the top 3/10macd are such that it reflects a 15-minute chart, while the bottom 3/10macd reflects a 5-minute chart.  The vertical dash line is the open of regular trading hours.

While on a chart which doesn't include the pre-market we had condition 1a.  With the 1a criteria I'm looking to trade a breakout (base-break, etc).  Again, not something that is hinted at on the 3/10macd because as we can see, the 5-minute macd pulled back well into 10am while price continued higher.  While the 15-minute macd fast line moved lower throughout the day.

The overnight high came into play on a pullback in the morning, while the IB_high came into play late in the afternoon.

The daily showing us well back above the 20-day MA and approaching the top of the channel already.  The faster time frame (130-min) showing a steep reverse divergence and looking a bit stretched.

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