I trade Nasdaq intraday exclusively
Trading in GMT time zone
Sharing my post day review & analysis in case it can help you :)
Back from Holidays and time to TRADE!
Did my analysis at +- 5:20am GMT
Looking exclusively for a buy, as Nasdaq is bullish overall – “The trend is your friend”
Even though we are at all-time highs, I keep my bias bullish. A true trend reversal will come with a double top market pattern on a high TF (i.e once a double top forms on the D TF, then I will consider a bearish bias). Plus we are at the bottom of an ascending triangle on the D TF marked with grey trend lines.
At time of analysis, I noted the following:
A doji candle on the D chart had formed from previous day.
Gap up on the day chart at market open this morning – indicating bullish presence.
A double top had previously formed on the 1H TF (yellow circle) and broken the neckline bearish.
On the retest of the neckline (in the same direction as the overall trend i.e. bullish) the bulls broke the neckline as well as the pink temporary downtrend line + gap up.
There was a retest of the pink downtrend line + neckline at A. with a red candle and bulls pushed back up.
I entered a buy at B. because on my smaller TF’s it looked as if the candles had broken the strong resistance + temporary orange downtrend line.
Turned out to be a glitch on TradingView (seemed the trendline was incorrectly positioned on the lower time frames even though correct on the bigger TFs?) and as you can see at B. the orange trend line was not broken. I was convinced that if the resistance + orange trendline the uptrend would continue.
I also admit to being additionally biased due to the apparently impending “Santa Claud Rally” and a slight case of FOMO.
Market however turned down.
I recognized my weakness in entering this buy (emotional trading) and immediately set a take profit at entry so that if market moved up it would close this position. Even if market continued to move up and past this position, I didn’t deserve the profit from this buy because it was not executed professionally (in my opinion) and I don’t want profit from being lucky.
I entered a more reasonable buy at C. – Confirmations:
- Market Pattern: Double bottom formed on the 15min TF and entered at the break of the neckline at C.
- S&R: Market was rejecting a D S&R line (marked in grey) + 1H EMA was acting as dynamic support
- Candles and Fib: The red candle on the 1H TF before the C was a longwick candle rejecting the 0.618 fib level of a short-term Fib drawn on the 1H TF from swing low at D. to swing high B.
Mental stop was placed at thick pink line, below 4H 0.618 retracement level, where trendline and 4H EMA converged. Meaning that if candles started closing below this point, then my buy would have been invalidated.
I would also have added another position if the market went down this far.
Endured a draw down of 315 pips, but ultimately bulls pushed up at market open and at time of writing this, market moved a max of 915 pips up from my position.
Take profit plan:
Want to test this “Santa Clause Rally” theory. It is define as a bullish rally in the last 5 trading days of the year and the first 2 trading days of the new year.
So I will keep this position running and close +- 3 Jan 2024.
I am secured at entry (actual stop loss placed at entry), so I am trading risk free and will see how far market will rally.
What could I have done differently:
No let emotions and FOMO come into my trading as evidenced in my first buy. I got lucky and the position was closed at entry as market moved up and my mistake did not lead to a loss.
Good luck if you are still trading! :)
TF = timeframe
TP = take profit
1H = 1 hour
4H = 4 hour
D = day
W = week
M = month
S&R = support and resistance
EMA = exponential moving average
Trading in GMT time zone
Sharing my post day review & analysis in case it can help you :)
Back from Holidays and time to TRADE!
Did my analysis at +- 5:20am GMT
Looking exclusively for a buy, as Nasdaq is bullish overall – “The trend is your friend”
Even though we are at all-time highs, I keep my bias bullish. A true trend reversal will come with a double top market pattern on a high TF (i.e once a double top forms on the D TF, then I will consider a bearish bias). Plus we are at the bottom of an ascending triangle on the D TF marked with grey trend lines.
At time of analysis, I noted the following:
A doji candle on the D chart had formed from previous day.
Gap up on the day chart at market open this morning – indicating bullish presence.
A double top had previously formed on the 1H TF (yellow circle) and broken the neckline bearish.
On the retest of the neckline (in the same direction as the overall trend i.e. bullish) the bulls broke the neckline as well as the pink temporary downtrend line + gap up.
There was a retest of the pink downtrend line + neckline at A. with a red candle and bulls pushed back up.
I entered a buy at B. because on my smaller TF’s it looked as if the candles had broken the strong resistance + temporary orange downtrend line.
Turned out to be a glitch on TradingView (seemed the trendline was incorrectly positioned on the lower time frames even though correct on the bigger TFs?) and as you can see at B. the orange trend line was not broken. I was convinced that if the resistance + orange trendline the uptrend would continue.
I also admit to being additionally biased due to the apparently impending “Santa Claud Rally” and a slight case of FOMO.
Market however turned down.
I recognized my weakness in entering this buy (emotional trading) and immediately set a take profit at entry so that if market moved up it would close this position. Even if market continued to move up and past this position, I didn’t deserve the profit from this buy because it was not executed professionally (in my opinion) and I don’t want profit from being lucky.
I entered a more reasonable buy at C. – Confirmations:
- Market Pattern: Double bottom formed on the 15min TF and entered at the break of the neckline at C.
- S&R: Market was rejecting a D S&R line (marked in grey) + 1H EMA was acting as dynamic support
- Candles and Fib: The red candle on the 1H TF before the C was a longwick candle rejecting the 0.618 fib level of a short-term Fib drawn on the 1H TF from swing low at D. to swing high B.
Mental stop was placed at thick pink line, below 4H 0.618 retracement level, where trendline and 4H EMA converged. Meaning that if candles started closing below this point, then my buy would have been invalidated.
I would also have added another position if the market went down this far.
Endured a draw down of 315 pips, but ultimately bulls pushed up at market open and at time of writing this, market moved a max of 915 pips up from my position.
Take profit plan:
Want to test this “Santa Clause Rally” theory. It is define as a bullish rally in the last 5 trading days of the year and the first 2 trading days of the new year.
So I will keep this position running and close +- 3 Jan 2024.
I am secured at entry (actual stop loss placed at entry), so I am trading risk free and will see how far market will rally.
What could I have done differently:
No let emotions and FOMO come into my trading as evidenced in my first buy. I got lucky and the position was closed at entry as market moved up and my mistake did not lead to a loss.
Good luck if you are still trading! :)
TF = timeframe
TP = take profit
1H = 1 hour
4H = 4 hour
D = day
W = week
M = month
S&R = support and resistance
EMA = exponential moving average