Readers of my blog postings know from my "Dude" series that my thesis for the market has been that the market is going to fail on its reattempt to get above the weekly 78.6% retracement level, and that "failure" will signal the end the bear market bounce that the market has experienced since March 2009.
Slope of Hope Blog Posts
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I wrote a trilogy on some new software that I have been using the past couple of weeks … whoopdedo right? While there are plenty of software packages available to traders out there, I think this code should hit home with traders because it really focuses on the trend of price. I have found that most intra-day traders get caught up trading against the dominate trend and/or don't stay with a trend long enough to maximize their profit potential.
Anyways, I'm not saying all traders should use the system but I think reading the three blogs will open some traders' eyes about how they look at intra-day trends. For that alone the trilogy is worth the read.
Part 1 of the trilogy goes over the software and its color coding features, the second the software code's histogram feature, and finally the third covers a couple of hours of intra-day trading from a recent day to show how it works.
Check it out if you want to learn more about trend trading … here is the third part of that trilogy. Cheers …
Every evening I publish an outlook for the next day's trading in the SPY ETF … it looks at important levels and potential patterns. Then on the following morning, I update the outlook with a tighter focus on the pre-market action and the specific Control Bar Values and other support/resistance areas.
I suggest that this exercise makes me a more prepared trader and I would suggest ALL active traders perform a similar exercise. For illustration purposes I will combine last night's report with the pre-market update that I just published.
I posted the following post at my blog site on Sunday afternoon … it is LARGE and is primarily an educational post. With that pre-warning, readers can advance if they wish …
Because I know Tim is a big supporter of EWT, I thought I would put up a post on GS …
I'm long GS and I am watching here as the stock looks like it has completed a Wave 2 retracement, and is about to start a 3rd wave push higher …
GS 10-Minute Charts
Wave 2 pull-backs are very emotional as buyers and sellers battle it out … they typically end at the 78.6% Fib level as GS just did .
The 2nd wave ended right in the projected target zone and is now on the cusp of breaking a down trend line.
GS 60-Minute Chart
It has to be determined whether or not the 3rd wave is just that … a 3rd wave in a corrective bounce, or whether it leads to a 5th wave push higher. We can figure that out when the 3rd wave is over and the pull-back begins.
Here is the Contraction Pattern I am hawking right now … it looks like it is going to pull-back before breaking the move higher.
GS 3-Minute Chart
Cheers … Leaf_West (please visit me at my blog (http://blog.tradingwithleafwest.com/)