Wednesday started okay, with a small loss due to my reluctance to take profit against the underlying downtrend. After stabilizing a bit, I caught the main move of the day, shorting from a 1m downwave all the way to the previous day’s support level. I was very pleased with this performance, and should aim to continue this kind of trading with larger size in the future.
Open
The open was very easy. I didn’t take the opening short off of the 1m 34, but went long at the bullish harami. Unfortunately, after reaching the base of the move, I expected 1m to continue to a 1m upwave, and held on until my profit disappeared. Respect the 1m bearish signal, especially when the underlying trend is so strong and bearish.
Day
As shown, the day was quite standard with a strong downward continuation on the established 5-15m trend.
The low was created yesterday at 1 PM, which meant the level was known in advance, at about 14983. After the low was reached, the market recovered but still had not made a clear bottom. This pull-up continued to the 15m 34, and stalled for the remainder of the day, until the market close. At the close, the market crashed through lows and continued lower overnight.
Unfortunately, my strategy suggests not to trade late in the day so I miss this. But the move was set up beautifully over the late morning, and options plays were insane.
Trades
My poor trades were mostly re-positioning for the short, which was not a big deal. But I took one 1m 34 short when the 1m had already failed to make its upwave once. I should wait for the upwave in the future, not just assume there won’t be one shortly after the open. In other words, 1m started off crashing, reversed to the 34, then pulled lower again, so the next move had to be a wave, as it was overdue. After that, the day was very straightforward and easy.
