My Favorite Long Set Up UWTI

UWTI 

I always try my best to start writing my trading journal as soon as the trade starts. It just reconfirms the confidence and the reason for the trade. 

UWTI 5 min (note the volume  !!!)

UWTI
The bold lines is what I posted in the AM soon after I entered the first long.
A picture perfect technical  great risk long trade
The 5 min chart shows for the first time in many days UWTI opened above the 200 SMA, the 20 sma the PDC and PDH with some gap up. Very bullish sign with 1.30 risk tolerance.. This is same set up as shorting a daily overextended stock explained in some previous posts.  I like the short much better , but this long on such massive volume was a no-brainier for me seeing /CLH6 (crude oil futures) doing what was doing.  I explained it to one of my "challenge students" on Wednesday  who  banked on Thursday shorting TSN, while  I was off  due to some circumstances.
At the open I watch mostly 2 min chart because the volatility tends to be the highest. Sometimes on high priced stock even 1 min bars can be powerful. Playing just the break outs of the 2 min candles in the first half hour many times more often then not, is quite all right for me  because of the great follow-through from one candle to another. I prayed that it will not break out but it did.
Why?
My plan was  simple:
 "If it breaks I'd have to go long, no doubts here, because the gap was not that big  and it may never come back...but there is also great chance of failure of the break and it may pull back and fill the gap to some point , maybe half of the gap maybe less maybe entire gap, who knows ?!? That I never know. I wanted  it to break  the  2 min low and fill the gap and then LOAD UP SIZE with tight risk, rather then just buy small size at the 2 min break out and see it grinding all day higher with midget size and make few bucks for  peanuts. I would simply not go big at the 2 min break out because I did not want to play with stop, and if filled the gap I would have very hard time to load up size. even on this $1 ticker. If the  open  was right at the PDC, PDH at the 200 sma then I would have loaded big right then and there, with 1.30 risk"

So what happen today ?

UWTI the initial entry small size with idea to build all the way down to 1.30

It broke the 2 min high open, so I had to NOT THINK and ignored all my  buddies sending me messages  telling me to be careful caus' the news were saying something about some deal  or whatever the talking heads were  giving their analyses and their opinions about the oil past few days or weeks or so.  Like I said in my prev post CLICK HERE , I already have MYSELF  100 opinions  and analyses that we bull shit about with my buddies every day,.. about the oil specially...My trading is about ignoring MY 100 OPINIONS that do me no good and sabotaging my trading so  I ONLY read the price action!

As twitted here I went long with plan and expectation to pull back and load more size at lower levels
It happen exactly that , failed the 2 min break out which in no way I would be short , and I wold not use stop below the 2 min low simply because opening above the 200 sma 20 sma , above PDH, PDC after 5 down days on such massive volume, shows pure power for long.
Then the drooping begun candle by candle. Each candle had  lower highs  without breaking the previous candle high on which I was waiting to  add more long. So I waited and watched the time and sales and  L2.
When it dropped below 1.35 it  was a  "leap of faith moment" or experience of many years of trial and error. I had thrown bunch of smaller orders below 1.35 all the way to 1.29, and waited to see how they get filled and how many will  get  filled  at those placed  bids. It was great seeing somebody's else's sizes of 450,000, 200,000 shares and  so on getting filled along with mine "dwarf" orders without any further down move follow through, and there were no fills on my orders  at or   below 1.33.
So what does that tell me ? I WAS NOT  THERE ALONE BIDDING BY MYSELF ! 
What a relief ! It was like being in a room with all the sharks , and listening to them what they are doing !
Another thing that also comes with experience of painful losing for many many years : Knowing that I will lose per plan about $3,000  if dropped below $1.30 ( you go figure now my size ) is way better then losing lot more money doing dumb stupid  trading in the past. I have lost $7,000 in a day by chasing , revenging, by trying to break a support level THAT I WAS THINKING it HAS TO BE BROKEN because the "TV" said there will be more downside.. which happen to me so many times and I've blown so many accounts in the past. Many many many times I would use huge size to  REVENGE TRADE with no set up , but just doing stupid  EMOTIONAL TRADING because I had just a small legitimate loser and I wanted my money back RIGHT AWAY. This is when the experience ( of pain and suffering ) comes in handy: "If I was revenging from stupidity using size so many times, why not use size once in a while when REAL OPPORTUNITY PRESENTS? I was pissed enough losing lot of money from revenge trading, so at least if I lose a lot per PLANNED TRADING I should  not be pissed off after so many years in this game "

UWTI the leap of faith bidding towards 1.30 

Then the stronger relief came in , seeing  finally the first 2 min candle high  break, which was

 NO THINKING NO HESITATING  ADD  more long

UWTI adding long 

Then I re-focused on the 5 min chart and woow : look at the clarity and confidence I got 

UWTI the magic set up triggering on 5 min and loading MORE

I have seen this set up  many times, done it  many times with small size , I have tweeted this set up quite often too,  I wrote blogs about it too among many others set ups. So what is there to think? How many barrels oil of supply and demand is in the world? Production cost ? Is OPEK gonna cut production or not? Or I should think of  Cup and handle? Trying to find  and define a perfect ABCD break out? Head and shoulders? Triangles of many kinds? Bollinger bands that u can draw from many different highs and lows?   he he he  

So I loaded up  BIG.  At this point I was not even thinking about losing. which is kinda wrong too,  but hey, having in mind all of the above said and explained , the odds were clearly in my favor here.

Did the High Wire Walker think of death when he was  walking on a wire between the twin towers in 1975 ? BTW must watch  that movie, so inspiring: "THE WALK" ..it is about doing what you love and not fearing from death. Amazing  true story. I felt the same when I first step foot inside the outcry pit at the NYME, It was the outcry oil trading pit many years ago where  I was  just stunned, and deep in my heart I knew what I love to do. Many years after went by filled with lot of pain of losing 

So what did I see precisely: 

3 to 5 or more consecutive bars with lower highs of each bar dropping into :

1) PDC ( precisely defined level, no argument no debating no thinking )

2) PDH ( precisely defined level, just reading price no guessing )

3) Above 200 sma ( nobody can deny it or modify it ) 

4) Golden cross /when 20 sma crosses the 200 sma / rising 20 SMA on 5 min 

5) Massive volume higher then any time  before any recent previous days 

It was trade by summary judgement; LONG !

Could I go short at the 2 min break down? SURE ! But if went up again above 2 min and flipped to long again taking a second loss, and then broke down below AGAIN, taking a third loss by the time it finally sets up the REAL GREAT LONG , I'd be mentally and financially exhausted and would not take the best entry.

ALL PRECISELY DEFINED ITEMS that nobody can deny or argue about.

Now those are things that I use that help me to read the price action. Anybody can find different things and guidelines to go by as long as they are precised,  not argumentable,  easy to recognize and to follow. There is never a guarantee that something will always work  forever, but longer you are in the game more you will learn and recognize. And to stay longer , knowing you will most likely keep losing you need to figure what is your comfortable  risk .

Focusing  to 5 min chart with candle by candle higher lows unloading into the highs of the third candle closing most at brake of the last candle's low.

I did few more trades afterwards too, but much smaller size looking at 15 min 5  min and 2 min trying to see if this thing may go much higher.  

Like I said many times , I can trade every day till end of this year and still wont be able to explain all trading set ups and strategies ....simply because I was trading / pardon losing many years,  losing my shirt off and learning from many loses. 

One thing  I do say and believe in : try to master ONE SET UP by DOING ONE SET UP  many months , and in case you happen to be  consistently green , then you may have some chance to progress. I am not saying  this because you are stupid, I am saying this because most of wanna be traders are extremely smart people who realized working a clock in job that they hate , will get 'em nowhere. It takes open mind and high intelligence to realize that. But the high IQ the cleverness, the open mind,  the great intelligence unfortunately is our enemy in trading. You don't wanna think during / in the middle of  your trade. You don't wanna analyse when  you are already in the trade. Because when you think you are admitting yourself that you DO NOT KNOW something. Thinking helps resolve  problems.  If you think where oil will go in the next ONE hour, or next month based on the DATA and ANALYSES that flood the media, if you try to solve that problem,  you will be right as many times as any moron will be right,  because both of you will be 50 /50 right or wrong.

Reading the CURRENT PRICE action NOW is what can  make you a successful day trader IMHO
I'm giving you all this free because not many  will do so,  and because I know the pain many of you go through losing  your money, your time,  your friends and family members who give up on you. You may think you are stupid , but you are not. We as humans are created to solve problems, to progress, to think to develop. We all want to think and based on our thinking we want to guess the price movement. By thinking we create a picture how our stock has to perform. The worst thing is some  times we are right just  like a broken clock, and we tend to  memorize those few times rather then those many other times when we were wrong. Why people love casinos? Because they win few times .. "it is so easy to win "  LOL

So don't feel bad if you are losing, Nothing is wrong with you. It takes lot of practice to master something. And if you happen to have a lot of money don't think that you will win this game just because you have a lot of money by blindly adding,  averaging and all that stuff.. Soon or later you  will lose it all. Having s lot of money can not make you a great guitar player if you do not spend months of practice. or tennis player ..or anything else.

Many people ask me to tutor them,  to open chat room  and all that stuff , but I do not want to have such burden of responsibility to be always available and to have to answer questions to subscribers.... I like to party sometimes just spontaneously out of the blue, or go on trip, or do what ever I wanna  do when ever I wanna do. That would be not fair if I accept subscriber's money.
After all, isn't the freedom what the treading  is all about ???

Salute
@DaChopa