Tuesday, June 16, 2009

Quality Trade Set-Ups on Different Time Frames




The 3 charts above from top to bottom are Qualcom, Exxon, and Potash. These are all showing nice tradable patterns on 3 different time frames. It is important to time your trades with the general market, and now that it seems almost certain to me that the general market will be heading south, it is a good time to look at individual stocks or options on them.

QCOM is showing a potentially long term short trade. From the looks of the chart, it would not be surprising to see QCOM near $20 by early to mid next year. That would complete a potential Gartley Pattern off the 2008 highs. A Gartley pattern is where wave A retraces to the 61.8% level and then the wave C retraces to the 78.6% level, which is at about $20.50 on QCOM.

XOM is showing an upwards ABC correction with nice time relations and a nice long-legged doji at the last swing high. This could be a nice intermediate term time frame trade for a short sale. Notice how far XOM is from its January highs as the S&P actually slightly broke above those levels. That may indicate future weakness.

Lastly POT is showing a very nice head and shoulders top on an hourly chart. There is really no support until about $96 on this, so an entry could be made short with a stop above the high of the right shoulder.


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