Wednesday Log – As Simple as 07 / 08 / 09

Trader Tip – The VWAP (volume weighted average price) is a wonderful tool to have plotted on your charts. I use it on my 1 and 3 minute charts as it gives me a good sense of direction with what side of the market I should be trading. I only use the middle line of the VWAP. Google VWAP for more info.

The numerical sequence of today’s date lined up nicely with my one round trip trade during the wild AM session. That first 90 minutes was crazy as the bulls and bears were pulling the rope in both directions with the bears finally taking control.

The CO set up once price penetrated yesterday’s close prior to knocking on the 79.25 door twice on the 3 min. Entered a sell entry stop @ 78.75 and filled but not before another attempt towards the PP and overnight HH. Internals were mixed but decrease in volume and SS divergence on HH gave me the confidence I needed to average into my position and added @ 81.75. Price ran thru the overnight HH of 882.5, ran the stops and stopped short of the PP where my stop was.

Internals began to weaken and NQ and TF began to fall hard so the trade began to get comfortable. PO1 finally hit just after 1100 and scaled out of my positions from there as I peeled off at key support areas. Had one remaining runner left for final possible push towards daily S1 and weekly S2 970 support area. The trade sequence was flat at about noon. No afternoon trading performed as I had to run some errands. Result: +25.5

This was one of those trades where I felt good about how I managed the trade. Although I did take some heat during the consolidation period 1000-1030, I had a good plan, saw strong resistance in 84-86 area and traded the way the market was telling me to trade. It is trades like today where I feel a sense of accomplishment in the development of my trading melon. Man, is it hard to redirect our thinking from how we are hard wired for everyday life and how we need to think in able to survive in this trading jungle. In the end, I’m told, it’s as easy and as simple as 1, 2, 3, or should I say 7,8,9? It doesn’t happen quickly but eventually it comes around and everything lines up.

Trade Well !