Blue Bar Low!

8/2/2010

Here is a quick chart from today. The TF gapped up and on the minor pullback after the gap the bars stay green. This is a good clue not to short the market at a gap open. Once we made the high at 664.00 area we did have a counter trend short. It is important to know how to spot the counter trend trades but only advanced traders should take the counter trend trades.

If you did take the counter trend short at the 662.00 level the TF fell to the 656.00 level and then we had blue bars telling us if we were short to look to exit the position. Following the blue bar exit the trade was +6.00 points!

Once the blue bar appears if we are short we follow trail the stop to the high of the blue bar. This way if the market falls more we can still profit but once the blue bars come in we want to play the stop very tight.

The blue bars were the low of the day! Once we get blue bars we are looking for the market to reverse its course.

It is important to know that with any indicator they are there to confirm the patterns. Our indicators are made specifically for the way we trade the markets.

Happy Trading,

www.eMiniSchool.com