16/03/15 – The Support level has failed for this potential Counter trend trade on CIG NYSE as last weeks bar open and closed below my support level zone with fresh air between the bar and the zone. This is now a low probability counter trend trade and therefore I have cancelled my Order. Having the discipline to walk away from a trade is important for me s there are plenty of potential trades out there with a higher probability of success. Chart s Below.
15/02/15 – A new Wave 5 low was formed during last week’s session for this potential Counter trend trade on CIG-NYSE and then the price pulled back into the support and resistance level. As last weeks bar was not beyond this level, there are still 8/8 indicators in the green for this potential Counter trend trade. I have adjusted the Stop Loss on my order to 3.92 which is $0.01 below last weeks new wave 5 low. The Risk to Reward profile has changed but still within my minimum 1:1.6. The MACD Histogram has contracted towards the zero line and will no doubt cross into +ve territory next week. Chart as Below for the adjustment of the Stop Loss on my order for this potential Counter Trend trade.
07/02/15 – This potential Counter trend Trade on CIG-NYSE is taking its time to setup. The price found a new low last week but importantly the bar is still within the Wave 5 target zone and so the setup indicators are not compromised and the entry point remains unchanged. I have adjusted the Stop Loss on my order to compensate for the new Low and it is now at 4.09. At the end of next week I will revisit this potential counter trend trade and re-evaluate at that time. Chart as Below.
18/01/15 – I have had great success with a counter trend trade on this CIG-NYSE stock in 2014 and at that time was on a Daily Time Frame, the full trade Diary for this previous trade can be read HERE . This stock does have distinct cycles and now on the Weekly Time frame another counter trend trade is setting up well with 8/8 of my counter trend setup indicators in the green. The wave 5 has found support at the target level last week and closed above that same level for the week. There is great Oscillator Divergence and the MACD profile is looking great to crossover the zero line from -ve to +ve. Due to the volatile nature of the markets I need to be conservative with my entry strategy, so I have decided to set the entry price for the trade @ 5.72, which is way out of the Trend Channel and above the 6/4 MA High line for next weeks bar position. This price is also above the last green bar to attempt breaking out of the wave 5 Bearish trend, labelled “iv”. Stop Loss @ 4.26, which is $0.05 below the low of last week and the wave 5 target zone. As with all my Counter Trend Trade setups my initial target for profit taking is the original Wave 4 of the previous Bearish Trend movement and in this case is @ 9.00, which gives a great Risk to Reward profile of over 1:2 for this potential trade. This may not trigger this coming week but I have a starting point and good entry strategy for this potential counter trend trade. A good positive move and close above the 6/4 MA next week would set this trade up for an entry before the end of January. Charts as below for the setup of this potential counter trend trade on CIG-NYSE.