Extend Your Time Frame

  • February 14, 2002
  • Dave Floyd

It was another lackluster day
from an HVT
standpoint as the market continued to grind its way higher. The S&Ps
managed a close above their 20-day moving average, 1115, and now have the 50-day
moving average in their sight at 1125. Regardless of what the final
numbers show, it was again a very unconvincing rally, in my opinion. 

There
were many trades that I took in the morning session as the market broke above
1112 yet actually made little to no money on. Where was the buying in the
underlying stocks? Good question. Frustrating, to say the
least. Luckily, if you kept your eye on some of the 15-minute and hourly
charts, there were a handful of setups that paid off. For traders
implementing HVT, it was another day of minimal returns.

I have reverted to my game plan from a month or so ago:
Extend my time
frame. Whether it be 5-, 15- or hourly bars, I am looking to short rallies
in downtrends and buy pullbacks in up-trends. Until the “Big
V,” volatility, comes back in all its splendor, the effort expended glued
to my screen for quick intraday pops is just not worth it. Remember, one
always needs to be flexible as market conditions are constantly changing. 

The great thing about HVT is that it is a great building-block from which you
can easily progress on to longer time frames. The same setups which you
master while “scalping” are applicable on a 5-,15-minute or hourly
chart. As a result, I feel I have an advantage which allows me to navigate
between the two styles as conditions dictate.

One stock that I like from the short side on the hourly chart is Nvidia
(
NVDA |
Quote |
Chart |
News |
PowerRating), a break below 61.36 may set the stage for a nice move to the downside.


Depending on your thoughts as to the future direction of the market, I offer you
three stocks to consider. The first one is a bullish chart formation, the second
two are bearish. (I
refer to long-term as a holding period of several days to weeks.)








Key Technical Numbers (futures)


S&Ps


Nasdaq

1139.5  

1521-22   

1128.7-30

1504

1125 

1493

1118 

1486 (critical
resistance)

1107-08 

1464-66

1101-02  

1452

1097 (confluence) 

1444

1085  

1425 (critical
support)

1081    

1396

1075

1365

1061

 

 

 

 

 

 

 

 

As
always, feel free to send me your comments and
questions. I will not be able to participate in TradersWire
today. I will be back in on Friday.


Dave

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