Tuesday, November 2, 2010

Transactions (FX) and (DJI)

Doji Star formed on DJIA
Open: 11,124
Close: 11,124
High: 11,244
Low: 11,062

Shorted at 11,210 and closed at 11,090.

Today, DJIA has moved towards 11,247 and recorded high of 11,244.
For PW traders, you will know that the market has formed a new B on Day Chart with our initial target price at 10,780.

If you have missed the short, or have already covered your short position like I did today, you can still expect the market to return to 11,200 region for a short opportunity.

Trading Plan on DJIA for 2-11-2010 (Tue)
DJIA Long (Intraday)
Entry 11,044.29 SL 11,004 TG 11,200

DJIA Short (Intraday)
Entry 11,222 SL 11,300 TG 11,050

DJIA Short (6 market days, estimates market to hit target by 10th Nov)
Entry 11,240 SL 11,340 TG 10,750.

I am actually hoping DJIA to:
Tuesday (2nd-Nov-10) close the daily candle at 11,200-11,220,
Wednesday (3rd-Nov) to create a marginal top at 11,300 but closed at 11,200 again.
Thursday (4th Nov) market confirmation of reversal + triple crossing on intraday chart
Friday (5th Nov) start of the waterfall

Everyday I wanted to short at top, but everyday I remind myself that the news release and market anxiety can drive the bull crazy, and the bear will also fight with its strongest strength.  The Risk : Reward is good if you know what I mean, and I believe you will have the highest patience now waiting for the market to tell us the truth, whether we are right, or we are wrong.

I remembered mentor JC shared an interesting and funny conversation some time ago: "Oh no... Please don't tell us that we are early (again!)" Hint: Market moves opposite, and triggered SL (again).

At this point, DJIA at 11,124.62, I do not know whether the market has confirmed the completion of XAB, or will a new X formed by Wednesday, but I personally have a feeling that it will.  Thats why I would prefer to short at 11,240, place my ultimate stop at 100 points away, and aim for 10,750 as my target price.

Secondly, this only the 1st Phase of correction, once DJIA has broken 10,750 convincingly, there would be 2nd Phase and we aim another 400 - 500 points, or more!

Traders, I hope you like what I have shared, and I hope all can make some good trades, make good profit towards the end of November 2010.

Related: My Weekly Forecast on DJIA & Nasdaq 100 on 1-Nov-2010
My forecast on EUR/USD back on 13th October - forecast market movement by 3rd Nov or 10th Nov

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