Today opened with a gap up, which is bullish, then filled the gap in, touched the 3ema, and closed very near the open, thereby forming a Doji. The Doji is a neutral indication but closing near the top of today's range and above all the MA's is a bullish indication.
One might worry this is the left half of an Evening Star presaging a down turn reversal. This could happen, especially after a long 4 day weekend with 3 days closed and 1 partial day. But, notice Stochastics are still not overbought. We definitely want to stay in the trade.
We put in a Day order again today for the hedge I explained in the last post. However, price didn't rise enough to trigger the order. So we enter the 4 day holiday period without a hedge. Not as comfortable as I would have been if we had sold the Call option.
However, let me share the following scalp trade I made today:
This is a 10 minute chart of Jan Natural Gas today. Compare this chart with the Feb Live Cattle Daily chart above. Notice something interesting? It's the same pattern. I didn't check all the compliance rules but the NG 10 minute pattern looks a lot like a Gartley Pattern, and the LE Daily is a confirmed Gartley Pattern.
There's a relatively long uptrend followed by a 61.8% Fib retrace in the form of an AB/CD pattern. Then a resumption of the uptrend. You can see this same exact behavior on both charts.
This is a good illustration of the fractal nature of the markets. But that's not why I posted it. The NG chart hit not only the 27.2 Fib extension but also the 61.8% Fib extension as well. In our LE Daily chart we're setting the target for just the 27.2% Fib extension. The ideal execution of the NG 10 minute scalp trade gives me encouragement that our LE swing trade will also hit its target.
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