Capturing the Push & Pull of the Markets!

I have been interested in trading since my father showed me how to read the Wall Street Journal when I was about 12 years old. My grandfather 'traded the markets' back in the forties and fifties, so I suppose it runs in the family!

I am not a professional financial adviser and these observations should be regarded as observations and lessons learned, not as professional trading advice. I am a fellow trader making an effort to create another stream of income doing something I love to do!

Thursday, February 26, 2009

McDonald's (MCD)

Yesterday, February 25, 2009, MCD presented a perfect trade set-up to the downside. The 5 moving average crossed below the 30 on the 5-minute chart, and this coincided with the same set-up on the 30-minute chart.





Knowing MCD's support and resistance ahead of time also is helpful. It is important to do your homework ahead of the bell when possible in order to identify correctly these areas. The market moves so fast that reaction time is enhanced by proper preparation. (Now if only I would do this each day!) It is the 'business side' of trading--doing the market research so wiser decisions can be made.

MCD had shown fairly strong support at 54, so this was the proper target for the day. While in the trade, it can be tempting to hold in anticipation that it will trade lower, but wisdom dictates that the target is 54, and it was not breaking this support easily. Therefore, it was wise to stay with the original target and exit, rather than allow a winning trade to become a loser.
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