Here’s How I’m Trading Elan (ELN)
Well, due to an oversight in last Friday’s
column, I inadvertently put in a list of Intra-Day Set-Up’s from my
trading service. This is what appeared:
| INTRADAY SETUPS |
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| Â | |||||
| Stock | Action | Entry Price |
Target | Stop Loss |
 |
| AMZN | Long | 41.63 | 43.42 | 41.34 | Â |
| BSXÂ | Long | 59.45 | 60.59 | 59.21 | Â |
| CFCÂ | Long | 70.94 | 71.85 | 70.67 | Â |
| WLPÂ | Long | 83.67 | 85.00 | 83.45 | |
Many were puzzled by that, but based on the
emails I received, it appears as though many of you took a stab at them. Well
as luck would have it, we had one heck of a grind up trend day. Each of the 3
picks triggered were up better than 1 point, with little to no effort. Call it
an early Christmas present, either way, glad you made some dollars, donations
are greatly appreciated, lol.
Turning to the markets, there is little doubt
that every major pull-back is being bought aggressively, especially into the
970-75 level. However, all we have done is go right back up towards the upper
end of the trading range, 1006-15. Will we push through? Tough call.Â
Short-term, at least based on the 15 and 60-minute chart we are very extended
(based on standard deviations), so a small pull-back would be “healthy” before
tracking higher.
One thing is for sure,
HVT, outside of the first 30-45 minutes is taking a back seat to
“extended time frame trading”, similar to that of the trades outlined above.Â
This is very typical of the summer trading. In some ways, it is a less
stressful way of trading, place the trade and let the price action be your
guide, no micro-managing. When the fall rolls around, we can get back to
employing both the HVT and the intra-day
set-ups, which is a very powerful combination.
Last week I had mentioned I was trading
Elan (ELN), in fact the stock offered a few
decent set-ups as well as one overnight trade. However, based on the close on
Friday, and an analysis of the daily chart, I am compelled to dip my toe in the
water on the long side with the expectation that there will be some regression
back to the mean, see chart below. I would keep a tight stop loss, perhaps
Friday’s low, but Friday’s price action favors a long here with clearly defined
risk/reward. Also note, the price is outside the lower Bollinger Band. Ideally
I would like to see the stochastics confirm this entry which is why I am only
establishing a small position presently.
From an HVT
standpoint it is imperative to focus on only 2 approached presently:
1. Fading the gap on the opening, when
applicable
2. Trading only 1 stock in an
HVT manner.
The price action is so choppy off a 1-minute
chart currently, that you need to be in synch with the price action in order to
have any edge at all.
| Support/Resistance Numbers for S&P and Nasdaq Futures |
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As always, feel free to send me your comments and
questions.
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