BIDU Update

I cleared out of BIDU long positions expecting a pullback, however initially as the BIDU trade was setting up, my original expectations were for BIDU to make a counter trend move up that "could" be larger than what we already have. BIDU was entered once as a short and is still at a 15% profit as a core short on a bull trap, this latest move was a bear trap. The question in trade over the coming days will be whether BIDU actually does have more counter trend upside or whether the primary trend is about to re-assert itself (or some other variation).

The charts... (and what a great example of using market manipulation to your favor-both trades successful and both on head fake moves)

 We stalked BIDU, even before it broke out in the yellow box, we knew that was the highest probability and that is also where we wanted to short BIDU-YES IN TO  A BREAKOUT! Since then, BIDU has headed down in what I believe is a primary bear trend, however when we saw this bearish triangle setting up just as it should according to Technical Analysis, we saw something positive in 3C and knew this was a bear trap and BIDU became a short term long trade, even though I kept the core short (hedged with longs), this trade was worth it. Traders expected BIDU to follow the red arrows to a new trend lower, instead it sucked them in on a positive divergence on a break lower and then broke higher causing them to cover and sending BIDU higher. I still think there's a good chance BIDU could continue higher, but I do think it will pullback before it goes much higher and how it act in that pullback will tell us a lot about the future of any further upside gains.

 As for the long term trend (the core short position), look at the daily chart of BIDU from late 2008 where it was heavily accumulated and then sold in small pieces in to strength, the 2011 top was bad with a leading neg. divergence, the 2012 top even worse as 3C is now lower than it was when BIDU was trading at $10 in 2009.

 The 4 hour chart showing the neg. divergence and where we shorted BIDU (in yellow), but also a recent positive where the bearish price pattern was, a bear trap.

 Recently the 1 min chart has gone deeply negative

 And the 2 min

 The 3 min shows the last accumulation area as BIDU squeezed shorts and that is now going negative

 The 5 min chart showing the same, also pretty negative.

It looks like the highest near term probabilities are a move to the downside, how BIDU and 3C react during such a move will tell us more about the near future.

The 15 min chart shows the bearish price area forming, the break below and the accumulation of all those short and the confirmation of the move higher, we'll have to see how this chart reacts as well.