Daytrading Course
Learn to Read the Tape
Exploit Pit Pivot Points
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PIVOT MAGIC JOURNAL - EXCERPT

Good morning,

Another (profitable) day of Ascending Triangles within
Ascending Triangles within Ascending Triangles.

Starting to suspect a conspiracy!

TGIF!!!
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E-mini
Thursday August 07, 2008

X = Morning session opens gap-down, with what could have been a very pretty Anomaly signal, including, supportive Volume, and a preceding trend
(Overnight, bottom left chart). Alas, it is mid-air.

1 = Unfortunately, this 123 "S" has good Volume support and begs early entry.

NOTE: With less a confirming tape, our basic rules (for non-aggressive entry circumstances)
would have kept us out of the upcoming scratch practice session.

A = Before it even registers completely that we got in with no slippage, the skies cloud over. Black Volume Bar of Death (pink arrow). Reflexively
(from simulated trading practice), the instant the next candle shows red, Exit Now! Scratch close to/at Entry and you pay the broker. Nice start.

2 = What might have been called a Doji Sandwich reversal was out of range of the S1.

NOTE: As we have discussed before:

· When the Doji dagger at the reversal spikes outside the Sandwich,
the Doji Sandwich is a powerful signal.

· When the doji dagger stabs into the heart of the Sandwich, it reduces
the efficacy of the signal.

Case in point.

Volume relaxes early for a long lunchtime sideways drift.

NOTE: Reading the tape reveals a pattern in the seemingly innocuous sideways drift. Price Action for the day,
till an inverse breakout at 2:30, describes an Ascending Triangle (thin lavender lines). The base is a previously
unidentified S/R. Even more interesting is the higher Ascending Triangle effort (Double lavender line), within
the larger Ascending Triangle. See PERSPECTIVE, below, for a longer-term congruence.

3 = Unappealingly small, this does meet the criteria for a "P" reversal behind the S1.

It's a Trap! Although the Volume on the reversing candle is encouraging (pink arrow), the following series of small red spinning tops made the succeeding,
white, almost enterable, break through candle (on diminished Volume, not unexpectedly) not very inviting.

4 = On the other hand, this 123 continuation of the Double top pattern (blue oval), breaking through the Ascending Triangle Support, from another
successful test of S1 Resistance, is most enticing.

B = Entry on failed test of MA. Nice Money Management opportunity. Advance the initial stop above the MA.

C = DVS (pink arrow) tapes a large, red, inverted (Bull) Dragonfly. Per PMT stop rules, move the profit-locking stop above the high of the candle.

D = Slight bull-interest, small and a Bull Dragonfly stall yield to a giant red candle. Happily, our position in suddenly in violation of Pivot Magic Trading
Maximum Profit Giveback rules. Mental stop at Giveback level.

E = Late-move DVS (pink arrow), a worn out Momentum symptom, tapes a large, red, Spinning top candle, an exhaustion of Momentum symptom.
Per our rules, move the profit-locking stop above the high of the candle. Worry (not a rule).

F = With the above reading in mind (= E), we are tempted to call this a Lower-Low-Turns-White and Exit Now!, near the top of = G (+/- 4.50 points).

In truth, however, this close to the Primary Objective (S2), in the wake of an overwhelmingly Bear assault, there is not much chance that the Bears will
quit without at least one final/desperate stab at the S2. This white Bull Dragonfly, much like the one mentioned in = D, is in fact a precursor to a breather
stall before the storm.

H = KABOOM!

Just as the clock and EOD Hiccup Danger Time have diminished our resolve, a huge Bear DVS (pink arrow) blasts loose a giant red candle, easily
overrunning the Support at S2.

Boy are we in Maximum Profit Giveback violation! Mental stop at Giveback level.

Be wary: AN S2 RETEST MUST CROSS YOUR STOP. Pepare your exit order in advance!

J = Large (a dwarf by comparison) red candle, on even stronger DVS. Again in Maximum Profit Giveback jeopardy, mental stop jumps to Giveback level.

K = Small spinning top indicates failing Momentum.

Black Volume Bar of Death (pink arrow) confirms it.

Our rules order us to exit the instant the next candle shows white. +/- 11.75 points

PERSPECTIVE
(Daily, bottom right chart)

Let's first quote yesterday's PERSPECTIVE:
"As we discussed in the commentary above, Price Action stalled at a slightly higher Historical S/R
(light blue dotted line) than we anticipated. Although the Third Time Through (TTT) attempt at the
base of the Ascending Triangle has neither succeeded nor failed. A bit of a pullback south, to get a
running start for the final Bull assault seem a serious possibility. From the Daily time-frame
perspective, there is still plenty of room in the nose of the Ascending Triangle (lavender lines) for
the Bull tendency to wind tighter."

Exactly!!!

Again Thursday, our trading tape (5-Min), depicting the internal events comprising the Higher Time
Frame, Daily candle. Just as the Daily tape is dominated by an Ascending Triangle formation (thick
lavender lines, on 5-Min, top chart as well), so have the intraday tapes been witness to Ascending
Triangles, within Ascending Triangles.

Bull pressure is building. Pullback to get a running start, well describes Thursday. Friday or Monday
may well be full of fireworks!

BEWARE OF FRIDAY TRAPS

REMEMBER: Trade the tape, not my prognosis!
Asher
=] ;-)>
Pivot Magic Trading Course
http://www.tradingthingys.com/PMTJ/Commodity%20Day%20Trading.html

Thursday's PMT Chart: