Trader-X...views from a distorted mind.

Facebook, summer vacation, and tad

2012-06-04T16:08:00.000-04:00

It looks like my downside Facebook target is getting closer - just a dollar shy at today's low!

As June arrives, I am going to take some time off to travel, enjoy the sun, and take care of some family matters. I'll be back later this summer, so check back or subscribe to the feed (top of the page "Subscribe to the Trader-X blog") to be notified when posting resumes.

Finally, I've been telling my readers about "The T.A.D. Principle" for years (see my post in 2006) , and I just finished reading the new version they released (you can get through it in about an hour). It is on a completely different level from the previous edition, and represents more of an exploration of the things we do that make us unhappy, and what we need to do to find happiness in ourselves as opposed to looking for it externally. If you purchased in the past, you get this new version free. If you have never explored "tad", I highly recommend you do - it could have a big impact on your outlook and your life, and it is well worth the effort.

tad - happiness revealed: insights on thoughts, actions, and destiny

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A trade from Chris...

2012-05-31T22:01:00.000-04:00

"CIEN, 15-minute chart, Fibonacci lines over the opening range. Price chopped around the retracement zone and then formed a nice hammer on top of it at 11:45, with support from the 5EMA. I exited at the Fibonacci extension, and re-entered on a break of the 1:30 hammer bar for a "beyond the Fibonacci extension" setup. I exited at $13.50 for a nice gain."

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Looking at Facebook

2012-05-30T17:59:00.001-04:00

Since there is a lot of talk in comments about FB, I thought it would be interesting to look at the action of the first 8 days.

If you plot Fibonacci lines over the first and second day, you can see that - after the short-lived bounce on day 2 - price gapped down below the low and then tested that low as resistance multiple times over days 3-6. It then started a three day move down that culminated with price nailing the Fibonacci extension and breaking below it late today.

I offer no predictions, but it seems to be at a decisive point here. It can either form a "Beyond the Fibonacci extension" setup and move down to the $24-$25 range, or it can retake the 100EMA with the potential to make it back to the retracement zone.

Tomorrow will be interesting to watch. All in all, I'm glad I avoided the Facebook hype!

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VMW - 052412

2012-05-24T23:56:00.000-04:00

Charles posted this trade in comments - check out his analysis here, as well as other trades and more Facebook talk!

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LBTYA - 051812

2012-05-18T16:59:00.000-04:00

Friday's trade brought to you by Warren:

"Shorted LBTYA on a break of the 13th bar. It was a nice pattern that gapped down, pulled back, and then broke back through the previous low of the morning. The trigger bar closed below the morning low, had a long upper tail, and resistance from the 8EMA. Covered at the Fibonacci extension at the end of the day. 15-minute chart, Fibonacci lines over the first 30-minutes range."

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Trade the charts!

2012-05-18T15:52:00.000-04:00

Let the comments from the last post be a lesson to us all - there is a reason we trade the charts and don't make predictions!

Sorry to those who commented - if it makes you feel better, I expected more from it too!

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Facebook sets IPO price at $38 a share

2012-05-17T16:56:00.002-04:00

Any bets on what it will open at, or the high of the first 30 minutes of trading? Closest answer gets the satisfaction of being the closest answer! Read the article here.

There have been a lot of good trades and discussion in the "comments" of the last few posts - I have not had time to cull through them and post charts, but I'll try to get a few up tomorrow or Saturday.

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GRPN - 051412

2012-05-14T19:22:00.000-04:00

Very insightful comments over the past few days - a lot of good trades and analysis, so check them out.

Here is a trade from Brian:

"Started the week out with a nice trade. GRPN, 15-minute chart, Fibonacci lines over the opening range. Price pulled back to the 61.8% line which was a little deep, but it recovered and I entered on a break of the 14th bar when it crossed back above the 38.2% line. It had support from the 5 and 8EMAs, and I rode it to $12 where it stalled out."

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Mid-week madness

2012-05-09T08:51:00.000-04:00

Thank you to everyone posting trades and analysis in comments. Just a reminder, please include the symbol, the day of the trade, the timeframe, where you plotted your Fibonacci lines (if applicable), indicators used (for example, moving averages, candlestick patterns, trendlines), where your entry was ("a break of the X bar high/low") and where your exited. And, of course, your reasons for taking the trade as well as any comments or questions.

I've had to omit some comments recently because they lacked a lot of this information, making it impossible for anyone to reference the proper chart.

Thanks, and I'll try to highlight some trades from comments tomorrow or Friday.

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ADM - 050112

2012-05-03T09:04:00.000-04:00

In the comments of the previous post, there is good analysis of trades in the following ADM chart, including discussion on targets, when to exit, and second entries. There are also many additional trades discussed - I will let you pull those charts up on your own.

Here is the ADM chart - refer to the comments of the previous post for analysis.

I am still enjoying Spring, so posting will be sparse for a while. But that should not keep you from going through, and participating in, the comments section!

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A short week

2012-04-24T21:09:00.000-04:00

I'm taking time off to enjoy the Spring. Here is a trade from Chris, and I'll see you guys (maybe) next week!

"BHI was a gap up. 15-minute chart, Fibonacci lines over the first three bars opening range. I didn't like the high tail on the third bar, but the trigger bar (5th bar) filled it in as it was a strong, green bar. I entered on a break of that bar's high and exited at the Fibonacci extension. What I call a classic X trade, though it may not meet your strict definition."

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A trade from Dan...

2012-04-22T18:32:00.000-04:00

As noted in the previous post, I am taking a few days off to enjoy Spring so I am behind on looking through comments. Here is a trade and question from Dan on Thursday:

"I traded EBAY on a 15-minute chart, Fibonacci lines over the first three bars. I entered on a break of the third bar high, and sold at the Fibonacci extension. The only red flag was the bar was a bit far away from the 5 and 8EMAs, so I am not sure if that meant most would pass on it. The price action of the first three bars was strong, though, so I thought the risk worthwhile. I appreciate any feedback."

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It's Friday!

2012-04-20T08:41:00.001-04:00

I took a few days off this week and will take a few off next week, so I haven't had time to cull through comments and look for charts to post. If I get a few minutes this weekend, I will try to highlight a few trades.

I hope you have wonderful Spring weather wherever you are, and have a great weekend!

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Charts from "comments"

2012-04-16T18:35:00.005-04:00

There have been some good trades discussed in the comments over the past few posts. Here are a few charts - please reference the comments of the last post for details. Both trades are from last week.

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More on Instagram

2012-04-10T12:38:00.002-04:00

Following up on yesterday's post, this graph is simply amazing. Under 10 employees and 30 million users. New world.

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Facebook buys Instagram

2012-04-09T14:28:00.005-04:00

Oh sweet irony - Kodak files for bankruptcy in January, and Instagram is bought for a billion dollars in April. I know their businesses aren't the same, but it is still an interesting statement on old world vs. new world (I'm pretty sure Instagram isn't even two years old).

I can see a bunch of Kodak Executives sitting around the boardroom, perplexed, asking each other "So they built this app for the iPhone, and just sold the company for a billion dollars?"

Facebook buying Instagram for $1 billion in cash and stock

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A trade from Ed...

2012-04-05T14:37:00.004-04:00

Ed has posted several trades in comments recently. Here is one from today:

"MRX, 15-minute chart, Fibonacci plotted over the opening range. I entered on a break of the 4th bar's high. The 4th bar was a hammer, and price bounced off the top of the retracement zone and the 5EMA. I exited at the Fibonacci extension for a .35 gain. I hope everyone has a good three day weekend!"

Here is Ed's chart with the trigger bar marked:

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Face the Facts: We Are All Headed For an iDisorder

2012-04-03T18:45:00.000-04:00

This is a follow-up to my post last week about smartphones.

"It should come as no surprise that we are all hopelessly addicted to our devices, particularly our smartphones. Why shouldn’t we be? We are now able to carry a powerful computer around 24/7 in our pocket or purse. The new “WWW” really means “Whatever, Wherever, Whenever.” And we are all succumbing to its draw. Just look at any restaurant table and you will see phones sitting next to forks and knives. It is normal to see someone pick up a smartphone, tap tap tap and put it back down while in the middle of talking. Is this healthy or are we all headed down a slippery slope toward what I call an “iDisorder.”

An iDisorder is where you exhibit signs and symptoms of a psychiatric disorder such as OCD, narcissism, addiction or even ADHD, which are manifested through your use — or overuse — of technology. Whether our use of technology makes us exhibit these signs or simply exacerbates our natural tendencies is an open question, but the fact is we are all acting as though we are potentially diagnosable."

I'm not sure if people agree, disagree, or ignore because they see these signs in themselves. For me personally, I'm a bit concerned and becoming more aware of my lack of awareness!

Read the rest here.

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Another trade from David...

2012-04-02T21:33:00.000-04:00

"This was similar to my TOL trade last week, but I prefer these three bar setups because they happen faster. 15-minute chart, Fibonacci lines over the first three bars, entry on a break of the third bar high. The third bar was at support from the 50% retracement, the rising 5EMA, and it was a strong bar that closed at its high. I sold at the Fiboancci extension for a .40 gain. There was a "beyond the Fibonacci extension" setup later in the day, good for another .40, but I missed it."

Here is David's chart with the trigger bar marked:

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A Smartphone Future? But Not Yet

2012-03-28T18:28:00.000-04:00

A compelling article on what smartphones may be doing to us:

Nicholas Carr, author of “The Shallows: What the Internet Is Doing to Our Brains,” argues in the book that because of the brain’s neuroplasticity, Web surfing rewires people to be more adept at perfunctory multitasking, but diminishes the ability to sustain focus and think interpretatively.

Smartphones are especially pernicious because they “increase the ease of access to the Internet far beyond anything we’ve had with laptops,” Mr. Carr said in an interview over his land line (he also owns a dumbphone, as do the other family members). “You see a similar type of compulsive behavior” to computer-assisted Web surfing, “but it can go on continuously from the moment you wake up to the moment you go to sleep.”

Such constant online status, Mr. Carr said, means that “we stop having opportunities to be alone with our thoughts, something that used to come naturally.”

“Anytime we have a spare second,” he said, “we feel compelled to check what’s going on outside of us.”

I am an avid iPhone owner and user, but these concerns have bothered me for a while. Read the rest here.

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A nice trade from David

2012-03-27T21:23:00.000-04:00

"This was a perfect setup, so I couldn't resist commenting. TOL, 15-min chart - price rallied after a gap up, wide range first bar, my Fibonacci lines plotted over the first two bar's range. Price pulled back to the top of the retracement zone and formed a nice "offsetting bars" pattern, and had support from the 5EMA. I entered on a break of the 5th bar's high, and sold at the Fibonacci extension. Classic X setup that worked perfect!!!"

Here is David's chart with the trigger bar marked:

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A trade from John

2012-03-24T11:28:00.005-04:00

"I'm not sure if my trades are worthy of highlighting, but maybe it is good for comments section. It is a little similar to the two charts from David and David - classic X type setup, 15-minute chart, Fibonacci over the opening range (symbol = GLUU). The trade is later in the day, however, so I am not sure that X would take it but other readers might have. Also, I use a trendline on this chart. Here are the specifics: Gap up, rally, pullback - the pullback never closed below the 50% retracement. Trendline from the pivot high on the third bar to the 12th bar. Entry was a break of the 2:30EST bar's high - that bar was also a hammer, and price had broken the trendline, and had support from the 8EMA. I closed the trade with a .20 profit which doesn't sound like a lot, but due to the price of GLUU it was actually over 4% gain."

Here is John's chart with the trendline and trigger bar marked (John, if I drew the trendline wrong please let me know in "comments"):

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Another David, another chart!

2012-03-20T14:04:00.006-04:00

"X, I have found that these setups tend to work nice: a gap down, and a move back up though the previous day's range, with a setup after a pullback from the high. An example would be DTV from today. 15-minute chart, Fibs over the opening range first three bars, and I entered on a break of the 5th bar high after price had a brief pullback and found support at the 8EMA. The entry signal was what you referred to as "offsetting bars". I sold six bars later when price hit the Fibonacci extension. Just curious if any other X readers trade this kind of setup.

David"

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Yesterday was Goldman, today its Google!

2012-03-15T13:01:00.004-04:00

"Why I left Google" - an interesting piece from a former employee on the negative impact that Google+ has had on the company (in his opinion, of course). My favorite quote:

"As it turned out, sharing was not broken. Sharing was working fine and dandy, Google just wasn’t part of it. People were sharing all around us and seemed quite happy. A user exodus from Facebook never materialized. I couldn’t even get my own teenage daughter to look at Google+ twice, “social isn’t a product,” she told me after I gave her a demo, “social is people and the people are on Facebook.” Google was the rich kid who, after having discovered he wasn’t invited to the party, built his own party in retaliation. The fact that no one came to Google’s party became the elephant in the room."

Here is an article about the post, and the actual post itself.

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Why I Am Leaving Goldman Sachs

2012-03-14T10:54:00.002-04:00

This is making the round on the Internets today, so you may have seen it. If not, it is worth a read.

"To put the problem in the simplest terms, the interests of the client continue to be sidelined in the way the firm operates and thinks about making money. Goldman Sachs is one of the world’s largest and most important investment banks and it is too integral to global finance to continue to act this way. The firm has veered so far from the place I joined right out of college that I can no longer in good conscience say that I identify with what it stands for."

Of course, a rational reader will question the motivation of the author. He seems to have made his money at GS, only after which he decides to publicly air dirty laundry. Regardless, it is interesting.

You can find the entire article here.

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