Cowabunga System Daily Update: 01/31/07

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Main Trend

Current Trend= Trend changed from up to DOWN at the close of the 11 pm ET candle.

I looked for long trades until the close of the 11pm ET candle. After 3am ET, I only looked for short trades.

Today’s Surf

8:15 pm ET- There was a moving average crossover for a long trade. RSI>50, Stochastics were trending up, and MACD was negative and gaining value. This is a valid entry. Entry was at the close of the candle which was at 9622 with a stop at the most recent swing low which was at 9609. Since the entry was 28 pips away from a 50 level, I decided to set my initial target for 9650. I also decided to go for a 50 level because the amount of pips I was risking was only 13. If I was to go for the same amount of pips I was risking and factor in the spread, it would be a very SMALL target. This is why I preferred going for 9650. 28 pips potential profit compared to risking only 13 pips sounds very good!

2:00 am ET- Unfortunately my trade is stopped out.

3:00 am ET- The 11 pm ET 4hr candle closed and made a trend change candle. This effectively switched the trend from up to DOWN. From this point on I was only looking for short trades. Unfortunately no signals were produced for the rest of the day.

Trade Result:-13 Pips