Post by Admin on Apr 6, 2015 8:08:23 GMT -5
As you know, one of my "go to" strategies is to take trades that show price exhaustion near support and become near term oversold. As a reminder, Exhaustion is basically a situation where the volume on a move increases more than the previous days and the the selling halts.
This is usually an indication that the sellers are probably done selling and we can look for some buyers to come in. This is what my system picked up on march 25th and put ADBE on my watch list. Here is how the trade played out:
A) ADBE support near the 72.00 area to close positive for the day.
B) I waited a few days for confirmation and then noticed that the bulls were winning based on how the price action was forming a "Doji" pattern late in the session on March 30th. So i went ahead and entered the trade on March 31st.
C) Before I even entered the trade I was looking for a possible exit. I noticed that we could head for a previous area of resistance near the 76.15 area ( look at the circle to the left) and I did my calculations and set my exit for that area. We saw some buyers come in on April 1st & 2nd and brought prices higher which took us out of our position for a decent gain.
As it is now, the exit was spot on as we saw the first signs of real selling once price went up into the 76.00-76.20 area.
Setups like these have a consistently high probability of working out but the execution has to be well done and in this case it was.
This is usually an indication that the sellers are probably done selling and we can look for some buyers to come in. This is what my system picked up on march 25th and put ADBE on my watch list. Here is how the trade played out:
A) ADBE support near the 72.00 area to close positive for the day.
B) I waited a few days for confirmation and then noticed that the bulls were winning based on how the price action was forming a "Doji" pattern late in the session on March 30th. So i went ahead and entered the trade on March 31st.
C) Before I even entered the trade I was looking for a possible exit. I noticed that we could head for a previous area of resistance near the 76.15 area ( look at the circle to the left) and I did my calculations and set my exit for that area. We saw some buyers come in on April 1st & 2nd and brought prices higher which took us out of our position for a decent gain.
As it is now, the exit was spot on as we saw the first signs of real selling once price went up into the 76.00-76.20 area.
Setups like these have a consistently high probability of working out but the execution has to be well done and in this case it was.