Here’s What We Like Best
It’s always nice to put up an alert on
TradersWire that yields profitable results, but I take just as much
satisfaction in a trade that was taken because of its strong pattern and
underlying technical merits that was managed properly for a small loss.
12:19:00
Intraday
Setup Alert
The S&P 500 ETF (SPY)
and the CBOE Volatility Index ($VIX)
are both at “polar” price supports. The VIX which measures
investor sentiment in the form of “fear premium” is testing multi-week
range highs, while at the same time the SPY is testing the 50% Fibonacci retracement level from the October lows. Today’s lows are also testing the
intraday 2.0 Volatility Band. Emphasis would be on reversal setups, but as always,
wait for proper entry off of well-formed patterns. The SPY is down 2.03 at
86.68.
12:49:53
Intraday Update
We tried it at higher levels, but quite often
it’s the second entry that yields results. From our last post at 12:19 p.m., the
SPY has set up as a 1,2,3 long entry. The ETF is down 1.96 at 86.75.
Sometimes the market has other things in mind, and even the best setups that
have strong technical confirmations don’t necessarily work out on an individual
basis. Today happens to be one of those cases. A high-probability reversal trade
ended up as a small cost for executing our trading business properly. The trend
traders love days like this, but sticking to a methodology successfully, through
both trend and reversal days, is what we like best. We know this is how we’ll
achieve long-term profitable results from our trading edge.