BIDU Trade Setting Up

BIDU looks like easy pickings so long as you have some price alerts set. Tuesday I updated BIDU, BIDU Follow Up which is the post with longer term charts so you can se why I like BIDU. It's also the post I pointed out a volume concept...

"Intraday you see the large volume to the far right? That usually will produce a short term oversold condition followed by a bounce that can be used to enter on strength, however BIDU is in the general area of "It doesn't get much better than this" as far as entries if you look at the daily chart."

So the very thing I suspected would set up a trade in BIDU, looks like it is. Again for the reasons why BIDU (short) or even a piggy back long, but in my opinion you are trading aggressively against the probabilities, are in the post from Tuesday linked above, but let's see where that chart from Tuesday has led us...

 I didn't include this chart which beyond the daily distribution trend (see Tuesday's update) has a more specific divergence at an area where the indicator should be making a higher high, this is the first failure of the year making this area extra interesting for a trade entry. All we are looking for is a little better price, a little less risk, a trade that comes to us on our terms and confirms everything we suspect BEFORE we enter it, although I like BIDU short just about anywhere in the area.

You'll need to set some price alerts in the direction of the yellow arrow.

 This is the exact area I was talking about on 9/9 (Tuesday) from the quote above. The increasing volume in size is a short term oversold situation that should hold up BIDU's decline and give us a potential opportunity for a better entry. As you can see, price has moved sideways since then, now to see if it has put in the divergence we'd like to see to show a probability of a move to the upside in which we can short in to as the strength of the move would be minor without a large base and large divergences which don't get put together in a couple of days.

 The 15 min chart looks bad, it is bad, it is where the probabilities are, but within that if you take a closer look...

You have a positive divegrence within a larger negative. The larger negative is like the Rock to the shorter divergences' scissors. In other words, the probabilities of a successful entry are already in place.

 Compare the 10 and 15 min charts above with Tuesday's and you'll see these are new divergences since then, they aren't large, the base isn't ;large, but they don't need to be to get the job done and offer us a trade that comes to us on our terms, allows us to verify before any entry and already has the probabilities highly skewed in our favor.

I'm just showing the 5 min chart which is just more confirmation.

I'll be setting alerts from here to the 225-$235 area and then double checking, but I'd say there's probably about an 80% chance that this is the entry and it works out fine.

These are by far my favorite trades, they come to you, give you all the advantages and you don't have to enter them if they don't look right upon doing what you expect, in other words they are verifiable that they reacted in line with probabilities.