Monday, April 13, 2009

Finding great setups in other stocks


I've been concentrating on trading SPY lately (with limited success) and I've kind of stepped away from trading individual stocks like I used to. I watched APA as I traded SPY today and saw some great setups that I should have taken.

There are two trades that are really close. The first is the bull flag (click on chart to make it bigger). The flag dropped to a moving average with a doji in a very nice pennant pattern. Very near that point the moving averages crossed over creating a great place for a very tight stop and a specific target.

Soon after the stock took off again, price broke through the previous high and created a trend reversal trade that had a bigger target than the flag. You could have held on past the flag target for additional gains providing that big red down bar didn't scare you out of the trade.

I might have to start trading individual stocks again, because I seem to make many more boneheaded decisions trading the indexes.

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