Monday, March 16, 2009
Why I sold my longs
Here is a five minute bar chart of today's e- mini session. I was long two units but sold them both at the green arrow. Why? The red arrows point to a 5 minute bar that I thought was either a breakout bar or a buying climax at the time, but I didn't know which. If it was a breakout bar the market would have continued up right away or after at most hesitating for 10-15 minutes. Instead we saw a steady decline of more than 25 minutes which broke below today's open (purple dotted line) and retraced more than half of that wide range bar. I concluded that it was probably a buying climax bar and so I got out.
I am still looking for a chance to get long again. I would only consider getting short near the top end of my range estimate for today (blue rectangle).