Trade Set-Up: Transports Follow Up

Friday I posted a trade set up for transports (short), Transports Trade Set Up. 

All we had/have to do is let the trade come to us and enter on confirmation of multiple timeframe signals. 

The following excerpt below (including the chart) are directly from the post /Trade Idea linked above from Friday:

 "Very recently and VERY quickly there was a burst of accumulation, it is no where near a stable base or anything I'd personally consider as a long as it is too unstable and unpredictable, but nevertheless, we have a 15 min leading positive divergence which I confirmed in essentially a single day (just a tad longer)."

If you are use to seeing 3C charts and what the accumulation process looks like, then you know that this is exactly what I said above, "Unstable", but for a short that we want to enter on price strength, this instability and weakness in its structure are most helpful.

Today, I'd say Transports did about 3-days worth of work toward our goal of a trade set up that comes to us on our terms, our price, when and if we chose based on the evidence.

In other words, I'm surprised (despite the fast forming, weak base) how quickly transports deteriorates today and how close they are to what will be our 3rd entry area (all around the same price).

 This is a longer term trend version (weekly) of my custom X-Over screen. You can see the long signal with all 3 indications confirming, then the uninterrupted up-trend without a single whiplash stop out over the entire period and now very recent, very clear se;;/short signals on all 3 indications.

 On the daily chart, I wouldn't have entered Transports short today just because of the character of the asset, it always gives away tops with bearish candlestick reversals, today (as ugly as it was), did not meet the criteria (the bearish candlestick give-away transports always seem to offer).

If you look at the original idea from 1-day (market day) ago, Friday, you'll see what this chart is about; support levels at white rows and head fake moves at yellow arrows below their respective support areas before attempting to bounce/rally.. Last Thursday we had a stop-run head fake below support at the yellow candle to the far right. Although volume has been down the last 2-days as price is up (as we needed it to be as Transports are the worst performing of the large averages on the year) which is bearish, the closing candle today was not the give-away. However, a lot of damage was done a lot faster than I would have anticipated.

 While the daily candlestick chart is not giving away the short set up (to the day)  the 60 min chart is sure showing weakness as the candles  become smaller in to gap fill resistance.

 This is the 1 min trend chart it's clear there's nothing even remotely approaching confirmation of the last 2-days, a good start.

 The 2 min chart seeing migration (kind of like the DIA today, the worst relative performer with regard to underlying trade and actual price percent gain) after last week's positive divergence which is what led to Friday's Trade set up.

3 min Transports chart deteriorating significantly today. Again you can see why I was interested in transports as they have been a horrible performer so any price strength is welcomed to enter new or add to existing positions.

5 min accumulation for a bounce and deterioration already.

Different assets will be ready at slightly different times, but typically most will be ready at the same time as the broad market, like the saying goes, "A Rising tide lifts all boats", the opposite is true.

This is going to be a nice set up if you are interested, it's one of my longer term core position favorites.