BHP 27th & 28th of June 2011

27th of June was a real slow day with the SPI down about 45 points for the day and the market grinded sideways for the most of the day in a tight range. BHP which was showing good signs of divergence and building up to break to the upside. Unfortunately I had to go out and missed the entry signal. What is my entry signal? The signal bar is a close above the double blue lines, the trigger bar is the next bar that breaks the high of the signal bar. Stop is placed at the low of the last minor swing low. Price target would be set to the blue line at 42.22 as the market was extremely sluggish, 15 points. In an active market the red line would be the target and with a more bullish market the green line would be max price target.

The next day with a positive lead from the USA BHP opens at near perfection at the green line at 42.74 which has a extreme high % for a reversal to happen.The chart started showing signs of negative divergence on the RSI (not shown) and the momentum indicator gave a signal to the down side. BHP broke down and provided a great short trade for the rest of the day. Points 32, secondary trade Points 23

Swing Trade hits the mark

Today I traded the open of the Aussie SPI Index given the positive move from Wall Street (DOW).
This swing trade was triggered at  4,494.5 and had lots of energy to rise quickly to 4518. The price target is worked out in advance of the trade entry. This price target has a 90% chance of success of being the top of the swing. Given the general weakness of the market and especially BHP taking profits against the trend is always a good idea. As per my previous post on BHP (which makes up the majority of the SPI) is in a down trend the SPI is going to keep going south. Points: 26

XJO - taking the escalator down

Today I took a nice trade using a 2 min chart of the XJO which the SPI (Aussie 200 Stocks Futures) mirrors.
The entry lined up with a negative momentum and previous lower highs. If you look at the swings up as waves like water you can see the energy dissipating. I used the 5 Min chart for perspective which showed more weakness and a potential to the target of  4558. Entry 4579 Exit 4558 points:21 :>

Swing Trade Video

Here is a short but to the point video on how to enter and follow with a swing high stop loss,

BHP - Weekly View - Finding support

From my last post of BHP its fallen 14.93% to 42.37. Looking at Momentum the lower blue line pressure is to the down side under the zero line, with no divergence forming. While its in a supportive area my bias is for it to fall to 41.98 which is not far off. If it breaks through that level then 38.32 is the next weekly level.

To trade the weekly chart a break below the line under the down bar would be the entry with the stop at the top of the bar. Move the stop to swing tops as the trend develops. Of course trading the weekly chart is not where swing trades would be taken due to the large time frame but knowing what the weekly chart is doing will allow you not to get carried away with counter trends within the major trend.