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.

Wednesday, October 31, 2012

Wed. 10_31

The SPY today

A key for the above chart to define the horizontal lines and dots.  For further explanation, see this link:   

Friday, October 26, 2012

fri. 10_26

A lot of drama for 4-days of a 1.3% range (though those four days started off with a 1% gap down).  So, all of that drama and we closed essentially around the midpoint of that range.

It's not the first time we have spent an extended period of time in this price range;

It has been a pretty steady pullback so far, while we come into support on the weekly

An updated view of a previous weekly chart.

A closer look;  some similarities between now and previous price behavior around the "re-test" range after a prior breakout.  It's possible the gravestone doji that closed on 10/19 (in the chart below) was our "re-test"; as the previous occurrence (back in April-May of 2011) spent 4-weeks following the high before a re-test.  The 10/19 doji was the 5th week following a high.  If this zone gives way there could be heavier selling.

Curious to see the stairs getting narrower through time though.  What I mean is that the returns on these rallies have been seriously diminishing.

week ending 10_26

Today's SPY

A key for the above chart to define the horizontal lines and dots.  For further explanation, see this link:   

and a higher time frame look, a late-day breakout didn't produce an encouraging result

Wednesday, October 24, 2012

Wed. 10_24


If you have to squint to make out any discernable patterns on the 3/10macd (as evident in the highlighted region on the 15-minute chart), then it's often best to stand aside and wait until oscillations become more obvious.

Tuesday, October 23, 2012

Tues. 4_29

Today's SPY

AAPL 2c-2d

Apple higher time frame (weekly) looks to be setting up the 2c-2d criteria.
Weekly showing lower momentum low on higher lows in price.
Daily showing 3d criteria on three pushes.

Thursday, October 18, 2012

Thur. 10_18

Tested above and slightly below the previous day's high and low.
The overnight midpoint ($146.01) acting as a bit of a pivot today, as well as the overnight low and the opening swing range.

Advance/Decline oscillating around the zero-line for much of the day.  Up/Down volume mostly negative all day

The past two days have been showing higher highs and lower lows, or what may be a broadening top.

Wednesday, October 17, 2012

Wed. 10_17

Opened just above the previous week's open and at the previous day's high.
Another breakout entry with quick exits (too quick perhaps).
The overnight highs ($146) acted as a significant pivot, as did the opening swing high which saw price ricochet off of.

A couple of entries on the long and short side.  Shoulda/Coulda/Woulda taken the 2c-2d criteria (15-min) entry just before 1:30.  The short just after noon was somewhat an all-or-nothing trade.  In other words, I should have taken half off at $146 which coincided around vwap at that time, but figured I'd either take a more or less b/e trade if it gets a strong bounce off of vwap or let it run to $145.75 (was thinking $143.70, but wanted to get more of a "guarantee" fill, which turned out to well).

While the Advance/Decline has seen some divergence these past two days, the Up/Down differential has barely seen a negative reading all week.

The daily coming up on that upper channel.   A 50% retrace would be nice to see, but being Options Expiration week, we could see things get manic.

an update on the IWM, QQQ, DIA daily charts posted over the weekend

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.

Monday, October 15, 2012

Mon. 10_15

Gap up, gap fill (-50% projection of overnight range), closed near highs.
Opening swing high was at the mipoint of the overnight range.  The overnight high played a key pivot in the afternoon/late-day session.  Finished the day right on the +100% projection of the overnight range.

Advance/Decline started off strong again this morning.  Dipped negative, but recovered.  Notice how the zero-line played support-to-resistance-to-breakout.
Up/Down Volume was positive all day long.

15m & 5m with 3/10macd - Would liked to have traded long the continuation move around 11:15am into the previous day's high, but wasn't at the computer.  I always like how the 20-MA acts as support/resistance on a 15-min chart.

Daily showing a bounce at the 50-MA, the "faster" time frame (130m) looks as though it could stand to put in a higher low.

Updated hourly chart showing the 3d-criteria bounce, however now there's a sell divergence showing.  $144.50 still an obstacle to overcome.

Friday, October 12, 2012


Weekly with faster time frame Daily charts.  Weekly still showing bullish trend in a corrective process.  Most are showing 2c criteria, where we can anticipate 2d criteria followed by a re-test of previous supply levels.  In which case we look for 3a or 3d criteria on the daily chart (which could take some time).

SPY - Broad channel on the daily.  Weekly looks to be going into 2c territory.

QQQ - weekly in the 2c-2d criteria. Daily looking like a bullish wolfe wave with big volume in the "sweet spot".  Red line would be the projected target of the wolfe wave.  Important concept taking place on the daily charts; very symmetrical "wave" cycles.

IWM - Those $85-$86's are a BIG (all-time high) resistance area.  It makes sense to fade off of them if it starts to form a base.  The daily is within a simple channel and showing a buy divergence.

DIA - weekly coming in to a support level.  The daily has a broadening wedge pattern going for it.


A comparison of the weekly DIA and QQQ.  Some divergences are small, like that of the past month, but a higher high/lower high or lower low/higher low comparison is interesting to think about (and look for).

DXY update

updated chart of the U.S. Dollar index from this previous post.
Failed to close above that $89.15.  There's a chance to break higher, but equally a chance to roll over.

especially given the potential for the weekly setting up a bear flag?


updated charts from this previous post.
potential 3d criteria setup on the 65min chart. Long way to go before getting to substantial resistance.

XLF - registered a strong momentum low on today's break of the wedge.  A throwback to the $15.90's is possible, particularly with EPS next week for GS & WFC.

Fri. 10_12

Keeps trying to bounce, but keeps getting sold, hmmm
For the first half hour there was a battle to retain the previous day's low and recover the overnight low.  Once breaking above the overnight low (and o/s_high) price made a bee line to the overnight highs (missing by a dime).  With lack of follow-through price returned to its comfort zone (overnight low, previous day's low, and o/s_high confluence).  The resulting head and shoulders pattern then fulfilled its measured move.

Advance/Decline showing the congestion at the zero-line before breaking down.

15m & 5m with 3/10macd.  The opening sequence was a 3d criteria setup.  The strong 15-min bar closed just above the resistance level to watch.  I did enter long (small) at the 9am trigger bar, but the trade was a scratch.  I almost scratched my short entry (patience).  Also, there was a short entry that I considered taking at around 12:30 but passed on it.  Was expecting a stronger bounce into the close, but it turned out pretty muted.

Daily & 130m chart; price trying to hold the 50-day MA and the breakout point from September 6th.  Slight buy divergence still present in the daily, but the faster time frame can still work lower (extending the fast line on the daily).

SPY weekly coming into the previous resistance breakout zone.  Weakest weekly bar since June

Thursday, October 11, 2012

thurs. 10_11

Gap up to the previous day's high.  Gave a half-hearted attempt at extending higher but not quite to the 25% extension of the overnight range.

Advance/Decline and Up/Down volume were quite bullish today

Should have taken a long around 9:30 and a short around 10:15 but didn't like the feel of it. Blue arrow is an entry, black arrows are exits.  My short entry before 12:30 was earlier than the "signal" (fuschia down arrow).