WwW on FTSE 14 min Tuesday 02/06/09

I've put two images in this post covering the same time but on one the Price will be the bigger and the RSI on the other - just to make it easier to see what was happening.



It's a rare event the WwW on RSI. First the one in black, which met all the criteria. It made a move up then stalled and came back again but not low enough to close the trade. Then the extra boost from the bit in red, again it didn't get going. Finally the tagged on green part kicked off and initial trade turned out well. There was no way IMO that the extra red and green ones were reasons to add to the trade, they just re-confirmed that the RSI was trying to move upwards.



The initial RSI W in black and associated Price/Bollinger data met all the criteria to trade - RSI level, risk and initial potential reward. I made it RSI ~ 32 for a Price equivalent of 4457.

The final outcome was a trade that went all the way up to the Upper Bollinger which at the time was around 4488 if my memory serves me correctly.

The problem for me was that I was already Short from the previous night! Instead of moving my S/L down towards the W as it formed on Price, my usual defence, I hung back, deliberately putting profit at risk, and got stopped out at 4470 for a reduced profit of 40.

The market then fell from this high and I traded the failure of a W. Which one? The highest base level, which I used to go Short at 4447. Looked promising, then the market turned, so I grabbed 10 with half and moved the rest to -15 which was linked to a Fib level of the drop. It died after putting up a bit of a fight, losing 2.5 pts overall.

Just for a laugh, it was ended by a W on the 16 min! The tail on the green candle between 1:00 and 2:00 triggered the "failed 14 min W" trade but provided Pt1 for the 16 min one!! To make matters worse, the 16 min one wasn't tradeable because the Bollinger Bands were too close together!!! Deduction, we were probably range trading.



cheers theory