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Monday, December 6, 2010

Airelon's Challenge Chronicles 3.1: Trade Idea ...

(Please note there are a few entries today)

Things were pretty slow around here today. That O.J. trade got scratched right out of the gate this morning.

So I've just been perusing through some charts, when I stumbled across U.S. Dollar Index Futures ... March contract. Implied probability is pointing me to short it. I'll have to wait for it to open back up, and the normal rules apply ... namely ... the spread would have to be tight, high enough volume to get in. But I like the resistance 'area' on the daily chart, and I like the fundamentals behind shorting what was a rally in a down-trend; along with my economic thesis ...

I have an alert set for at or below 79.965. Of course, if it broke above 80.50, well ... I hate to use the term ... "scratch" the trade, but I'd probably wait for another pattern to develop before looking at the chart again.

Edit: 6:43 pm est - Things I'll be watching near the open of active trading in a bit. Tighter spread. Volume around 100 for 10 minutes would be nice. No gaps. Then the 'regular reading of the tape' that I've so often discussed.

Edit: 9:34 pm est - Took it for a short out of the open, talked about the trade in the twitter stream as it happened (couldn't get to the screen capture). The market held to the parameters, and I took $46.00 out of that move before commissions. Completely out of the trade. Second profit for A.C.C.

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Note: This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 14 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

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