FSLR Update

As I was preparing this post I was interrupted by a quick update I needed to get out. I want to make a point though, although the market is probably the most dynamic entity we'll ever be involved with, there are probabilities and this is what I was talking about earlier, "Aligning your trades with the probabilities".

I probably confirm what I already know have a 80+% probability just because I get a little myopic about stuff, I think most traders would say, "OK, here's the signal, just wait for the pullback and buy" whereas I say, "OK here's the signal, wait for the pullback, lets just confirm the pullback and make sure and then buy".

However, for your information, I want to let you know that, once probabilities are established, the chances a tactical entry will go the way you expect are very high.

For instance...

 When we have a 5 min chart like this QQQ that is negative, the probabilities of a short term trade moving to the downside are very high, thus as long as you align the trade (you don't want to treat this as a dat trade, nor a trend trade, but maybe a short term swing move) you should be on the side of probabilities and that's all we get in the market unless you are doing something illegal.

So this is why I can look at a chart like this and say, "I want to short in to that price strength" and almost did today, because I know where near term probabilities are.

As for the larger  move (lets call this a swing trade+plus ), you can see the negative divegrence and the probabilities it created and the price move following it. Now you can see the positive leading divegrence and it has the same high probabilities of firing a move to the upside. This chart is a stronger set of probabilities than the one above, but it doesn't negate the signals above. If anything, having as many charts as possible all pointing the same direction is the best set up you'll find.

Imagine this is a car, the shorter term charts above lining up in the same direction would be the key to start the car, otherwise it's a great looking car waiting to be taken out for a spin.

Our longer term PRIMARY trend on this SPY 4 hour chart is clear, significant distribution for a long time and you can see the start of a turn in the market, what you can't see yet is how much price damage will be done because of that significant distribution.

Still, this chart likely will not fire even though it is the highest long term probability, until the 30 min charts go negative again and align.

I hope that helps...

Back to FSLR which ties in to this topic.


This is a PERFECT reason why I'd rather hold dry powder in to a market pullback as I think we can saw with some certainty, the next major move is going to be the one we've been tracking for 2 weeks, it's not going to change the primary trend/signals, but it will cause a ruckus.

I'd rather try to get in to something like FSLR long on a pullback move.

 We have a clear downtrend, but there's something I say often, "Price can be very deceiving".  As a trend trader I'd be short all day and night and not thinking of anything else, but there is something else going on.

 I'd like to see a bit more of a base/lateral move or reversal process which means FSLR needs to come down from current levels.

 Here's the Trend Channel, but often we'll get 3C data first telling us to act or warning to maybe tighten things up.

This is an hourly positive divergence it is similar to the market, except larger so the trend trader doesn't see what's lurking just below the surface.

 This is a sharp leading 15 min, price needs to pullback a bit for this to make a new leading high.

And intraday that looks like what is going to happen as there's a very sharp, sudden leading negative just after the op-ex pin is done for the most part.

 We have a 10 min negative too, the idea here would be for price to pullback and the intraday charts to accumulate the pullback sending the 10 min to a leading positive divegrence, giving us a full house and likely firing with the market.

I'd put this on your radar.