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First, Friday’s action on the Qs:

Friday printed another Thrusting Bearish candlestick within this apparent topping formation. For a longer-term trade, I’m still watching for a break through the 43.20s, and if we get that break, I’d now set my “loosey-goosey” stop at the second high of the formation- on 12/5, at 44.55, and my position size accordingly. For example: With an initial potential loss, or “R“, of about 1.30, if I wished to risk $100 on the trade, I’d need to short $100/1.32, or about 75 shares.

I’d like to point out here that, had I left my stop alone when I got short on 11/27, I’d still be short and in pretty good shape. A little more patience is often the key to better trading. A concept to which I’m sure many of you can relate– we’re often faced with a choice between making money and trading. Sometimes making money requires you to sit still. Sometimes not trading is the hardest part of all. Check out Lloyd’s pursuit of fewer, better trades over at The Miseducated Daytrader for some great, introspective thoughts on the subject. Also X’s post Chasing Success, Again — which induced a lot of reflection in most of us.

Also note that we keep coming back, over and over, again and again, to the fact that success is not in how many setups you can spot or what expensive software you use… it always comes back to something more personal, more psychological… something inside.

On to Apple…

A retrace into the drop, lower volume, finished below the halfway point between the day’s high and low. Short still intact. Higher low, so stop stays the same.

Gold pulled something of a fakeout:

It gapped up on the open, then reversed and fell throughout the day. I was looking for an entry above 63.13, which was triggered, but the OGR (opening gap reversal) was the signal to take that trade back off, for a loss of about 15 cents.

Was gold’s action correlated with the dollar again?

Well, duh!, of course it was! Dollar gets stronger, takes fewer of them to buy the commodity, price of commodity in dollars decreases.

A commenter (thank you!) on the previous post pointed out the beautiful Bearish Engulfing candlestick at the top of a long uptrend in Goldman Sachs (GS). It was textbook, with multiple levels of resistance right at the $200.00 level. However, the break didn’t happen- $200 held to the penny, and we got a strong rally thru the end of the day:

A couple of things about Friday’s action concern me:

• The stock formed a Long White (blue) Line- the buying pressure continued throughout the day

• Friday finished at 205.10, above the 11/27/06 high of 203.35, and, for you Fibonacci fans, also above the 61.8% retracement of the previous (Bearish Engulfing) day’s range, or 204.14.

This action on Friday appears to show some remaining buying interest in GS, and although I’d still love to get a shorting opportunity on this stock, I think I’ll now take a little longer-term view:

Dave Landry’s Big Blue Arrow is one of the finest indicators around. I think he’s got trademark rights on the color blue :), so I drew a green one. No doubt which way the big arrow is pointing on this longer chart.

So, what to do? Right now I’m watching for a breakdown past the 11/28/06 low of 191.50, a followthrough downward thrust, then a retracement (up) on decreasing volume, at which point I’d get short, as my friend Mr. Bananaweeds says, with great vigor.