The Opening Range

Wednesday, November 3, 2010

The most perfect example of the opening range strategy. Blue lines define last months resistance, the market flew through resistance hard and broke the opening range defined by 14.70-14.40. If the market holds above 14.70 for 2 days or so, you will see financials make a very nice move.

This is a position where I am willing to add alot of capital too. Why?????? Why have I determined that I can add alot of capital to this trade? The reason is I know where I will get out, just under resistance "blue lines."

SanDisk, SNDK is another one that I am itching to buy. Looks like it is about to break that resistance defined from prior month action.

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Purpose

I have learned quite a bit over the years in trading markets. Writing this blog helps me solidify those concepts and make them concrete in my mind.

"The most depraved type of human being is the man without a purpose."

-Ayn Rand

"By proper mental equipment we do not mean the mere ability to take a loss, define the trend, or to execute some other move characteristic of the professional trader. We refer to the active or dormant qualities in the make-up: viz., the power to drill himself into the right mental attitude; to stifle his emotions, such as fear, anxiety, elation, recklessness; to train his mind into obedience so that it recognizes but one master-the tape. These qualities are as vital as natural ability, or what is called the sixth sense of trading."

-Wycoff circa 1910