Took a long position today on
QCOM
, and it worked well. entry point was $75, and the first target is $83.6, with a possibility that i just hold it for a long term (I like QCOM for the 5G motion)
i wanted to share this trade cause it's a classic example of a setup that i call "the fisherman" - and while it's very easy to learn and use, it can provide high probability trades.
here's how the fisherman works...
- first we need to look at a Renko chart - you can see from the dual view here how super easy it is to see the signals on a Renko vs a regular bar or candle chart - Renko is a real secret weapon -- maybe we talk more about that in future posts
- on the price chart, i have the MagicWave - ignore the Wave (aqua/orange) line, the other lines are a 10sma (purple) and a 30ema (blue) -- easy to add to the chart individually. the main one we need is the 30ema
- on the lower panel there's my own version of the Balance Of Power - but you can use the Dual RSI indicator that i published before. why we need this? cause it shows momentum for 2 periods, a fast and a slow - and that's important for the signal we want to see. use a fast length of 5 (yes we want this to be really fast) and a slow length of at least 6 to 8 times the fast - we don't want the slow length to be "too sensitive".
how does the fisherman setup work? what signals do we look for:
1- the price will cross the 30ema going up (the yellow circle), at the same time, both the fast and the slow momentum (RSI) will go positive (as in the yellow box)
2 - the price will retrace back towards the 30ema then will bounce off the 30ema (the green circle), and at the same time, the 30ema will start moving up creating a bottom - the shape in our green circle looks like a "hook" - that's the fisherman's hook :)
3 - super important, while the price is doing "the hook", the fast momentum moves down, maybe even into the negative zone, *but* the slow momentum remains green - the setup fails if the slow momentum also goes negative - we need to have a positive "backdrop" that shows there's a prevailing commitment to the upside
4 - The Entry: you're the fisherman, you have the hook, and now you need to "catch" an entry as low as possible for maximum profit - yes, we will be "bottom fishing" here :). in today's trade, i got lucky and caught the $75.
5 - The Position: once in the trade, we set the target and exit loss .. and back to our regular programming :)
i hope some find this useful - practice the fisherman setup and add it to your arsenal of possible setups or even as a way to validate your good trades and entries
(the fisherman can also be used in catching a good entry for a short, the hook will be the other way around. see if you can identify the 2 other fisherman setups on QCOM since the beginning of March - zoom our the Renko as needed)
good luck!..
QCOM
, and it worked well. entry point was $75, and the first target is $83.6, with a possibility that i just hold it for a long term (I like QCOM for the 5G motion) i wanted to share this trade cause it's a classic example of a setup that i call "the fisherman" - and while it's very easy to learn and use, it can provide high probability trades.
here's how the fisherman works...
- first we need to look at a Renko chart - you can see from the dual view here how super easy it is to see the signals on a Renko vs a regular bar or candle chart - Renko is a real secret weapon -- maybe we talk more about that in future posts
- on the price chart, i have the MagicWave - ignore the Wave (aqua/orange) line, the other lines are a 10sma (purple) and a 30ema (blue) -- easy to add to the chart individually. the main one we need is the 30ema
- on the lower panel there's my own version of the Balance Of Power - but you can use the Dual RSI indicator that i published before. why we need this? cause it shows momentum for 2 periods, a fast and a slow - and that's important for the signal we want to see. use a fast length of 5 (yes we want this to be really fast) and a slow length of at least 6 to 8 times the fast - we don't want the slow length to be "too sensitive".
how does the fisherman setup work? what signals do we look for:
1- the price will cross the 30ema going up (the yellow circle), at the same time, both the fast and the slow momentum (RSI) will go positive (as in the yellow box)
2 - the price will retrace back towards the 30ema then will bounce off the 30ema (the green circle), and at the same time, the 30ema will start moving up creating a bottom - the shape in our green circle looks like a "hook" - that's the fisherman's hook :)
3 - super important, while the price is doing "the hook", the fast momentum moves down, maybe even into the negative zone, *but* the slow momentum remains green - the setup fails if the slow momentum also goes negative - we need to have a positive "backdrop" that shows there's a prevailing commitment to the upside
4 - The Entry: you're the fisherman, you have the hook, and now you need to "catch" an entry as low as possible for maximum profit - yes, we will be "bottom fishing" here :). in today's trade, i got lucky and caught the $75.
5 - The Position: once in the trade, we set the target and exit loss .. and back to our regular programming :)
i hope some find this useful - practice the fisherman setup and add it to your arsenal of possible setups or even as a way to validate your good trades and entries
(the fisherman can also be used in catching a good entry for a short, the hook will be the other way around. see if you can identify the 2 other fisherman setups on QCOM since the beginning of March - zoom our the Renko as needed)
good luck!..
Trade active:
Just wanted to update here.. stock market got hit and prices started going down - since i want to hold this position for a long term, and after the usual phase of upset, sad, and holding on to an "unrealized" loss in my P&L, i started to add to that position slowly to benefit from cost averaging. so far i brought my cost down to below $70 for QCOM. Red days are good times to consider adding if you can.
Trade closed: target reached:
Position closed at $105