Tuesday, April 28, 2009

Follow the Cat into Midstream & Set the Hook!

Playing to the Behavior to the Prey is Part of the Sport
2D. 10m. - Apr. 28 - The SPY opened in the lower range of the Channel.  The Trend is up.  The first candles were up and the internals improved.  The MACD was trending up.  Call position was taken with anticipation of Gap Closure and movement to the centerline of the Channel.  Note the High Hockey Stick in the CCI that signaled to Sell Point.  We will call this the "Channel Cat Play."
10D, 30m. - Apr. 28 - The trade was followed on a longer term chart to maintain perspective on the overall strategy and market environment.  
3M, Daily - Apr. 28 - The Channel Trend is still up but the resistance lines are plainly visible.  The past week has been a sideways meandering.  A Breakout above or below these lines could be important indicators as to where the market goes from here.  Notice that the MACD is "very quiet which often precedes a breakout as in the Sleeping Tiger Play.