Cowabunga System Daily Update: 02/12/07

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Main Trend

Current Trend= Trend remained down the entire day.

Today I only looked for short trades

Today’s Surf

8:30 pm ET- There was a moving average crossover for a short trade. RSI<50, Stochastics were trending down, and MACD was positive and losing value. This was a valid entry. Entry was at the close of the candle which was at 9519 with a stop at the most recent swing high which was at 9535. Since the entry was before midnight and because I wasn’t too far away from the nearest 00 level, I decided to set my initial target for 9500 and then try to go for more pips if that was hit.

12:45 am ET- Unfortunately I was stopped out of my trade. Result: -16 pips

2:45 am ET- There was a moving average crossover for a short trade. RSI<50, Stochastics were trending down, and MACD was positive and losing value. This was a valid entry. Entry was at the close of the candle which was at 9519 (that’s odd…this was the same entry price for the first price!) with a stop at the most recent swing high which was at 9556. Since the entry was after midnight, there was a good chance for some movement. Instead of targeting the nearest 00 level (9500) which would’ve only gotten me 19 pips, I decided to go for the same amount of pips I was risking. In this case, I was risking 37 pips which put my target at 9482.

5:15 am ET- Price hits my second target at 9550 and makes a nice clean break, getting as low as 9436. However, the price ends up closing above 9550 so I decide to go ahead and exit my trade at 9552.

Trade Result: -16 +67= +51 pips; R-Multiple= 0.81

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  • pacifier

    Hi Bigpipin,

    I didn’t get a crossover @ 8:30 pm ET. Just to confirm, EMA(5)

    On R multiple, the first trade would result in -1.00R (since its a full loss). And the second trade resulted in +1.81R (67pips/37pips). So the net result for the day should be +0.81R.

  • pacifier

    Hmm some of my post got cut off. I wanted to make sure that EMA5 needs to be below EMA10 for a crossover. If EMA5 equals EMA10 its NOT considered a crossover.

  • pacifier

    Hi Bigpipin,

    I didn’t get a crossover @ 8:30 pm ET. Just to confirm, EMA(5)

    On R multiple, the first trade would result in -1.00R (since its a full loss). And the second trade resulted in +1.81R (67pips/37pips). So the net result for the day should be +0.81R.

  • pacifier

    Hmm some of my post got cut off. I wanted to make sure that EMA5 needs to be below EMA10 for a crossover. If EMA5 equals EMA10 its NOT considered a crossover.

  • bigpippin

    Yea sorry about that. I don’t know where I got 1.38 from. Regarding the cross, the 5 EMA should be lower than the 10 EMA for a short trade and vice versa for a long trade. Looking back at 8:30 yesterday, the 5 EMA was 1 pip lower than the 10 EMA which is why I saw a cross.

  • bigpippin

    Yea sorry about that. I don’t know where I got 1.38 from. Regarding the cross, the 5 EMA should be lower than the 10 EMA for a short trade and vice versa for a long trade. Looking back at 8:30 yesterday, the 5 EMA was 1 pip lower than the 10 EMA which is why I saw a cross.