Don't pay dollar to keep 2 cents when wrong. Cut your losses quickly. Trade what you see, not what you think.
Joined Oct 26, 2011
719 Blog Posts

Pass the GLUU please

GLUU looks like it is setting up for a mighty bounce.

Ok, we may have a catalyst giving this news here- Nevada legalizes first interstate online poker.

Take a look at the hourly GLUU chart below:

GLUU hourly chart

Did you see how the price action break out of the downward trend-line and then consolidated into a ledge?  The way it is looking now, price action wants to go up.  If it takes out the ledge high of $2.38, I will add more.  If it takes out the low of the ledge at $2.27, I will cut my loss and move on.

I particularly like the big ass up bar right before the ledge.  Sometimes, after a spike like this with higher than average volume; it may be a start of a runner if the catalyst is substantial enough; on the other hand, it could be one of those “spike and ledge sell pattern” within a bearish trend.  This is why it is important to see which side of the ledge price action is going to take out next week.

Take a look at the daily GLUU chart below:

GLUU daily chart

Did you see how it was bouncing… bounce once on mid-Nov 2012; bounce again on early Feb 2013;  the 3rd bounce came off from a higher ground and stayed within the “upward” Andrew Fork lower line.  In other words, I see a good risk/reward trade here as long as I use the ledge on the hourly chart as my guidance for protective stop.

Btw, I didn’t get into this trade until the last 15 minutes on Friday when I saw a spike up.  This last minutes spike up reflected the price action upward bias inside the ledge; that was why I bought in my starter position.  If it had spiked downward instead, I would have passed and skipped the trade.

Trade well!

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