You Can Observe A Lot By Watching

Trading Doesn’t Have To Be Hard
Trading Doesn’t Have To Be Hard
March 13, 2019
Low Conviction
Low Conviction
March 14, 2019
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You Can Observe A Lot By Watching
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You can observe a lot by watching.

Yogi Berra

Sometimes trading opportunities present themselves when we are open and receptive.

Recall that I highlighted that volatility as measured by VXXB was sinking and that volatility and measured by the ADR were expanding.

In these types of environments, we can expect to have many near-term trading opportunities.

With ample news flow to keep us distracted, getting caught up around the why matters less than capitalizing on the short-term price action.

VXXB 10 Min

I wasn’t expecting much in the afternoon so when we started to see equities sell-off in the afternoon on the Boeing news VXXB was the perfect trading vehicle.

As I’ve highlighted, VXXB is currently trading with full time-frame alignment to the downside. Hence any long needs to be recognized as a profit taker.

Entry was at the break of the outside-inside pattern on the 10 min. Profits were taken along the way with the final piece at 28.90 – yesterday’s lows – which eventually was 1 tick from the high of the day.

BA 30Min

After the exhaustion in VXXB, BA presented itself as a great short-term opportunity.

Sellers had pushed BA down on the 30 min chart with a large outside bar followed by another bar down on very high volume.

The long entry was a break above the bar after the outside bar which coincidentally turned into a bullish hammer.

The target was the outside bar high as any late shorts would probably have their stops there making it an important pivot.

This current market presents many opportunities if we are willing to watch and act responsively vs. reactively.

You Can Observe A Lot By Watching

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Low Conviction
Trading Doesn’t Have To Be Hard