YMH2, (3, -1) formula, 1.618% Stretch fade profit, 4 Jan 2012


Hi,
4 January 2012: Offset YMH2 12282 long (07:36PDT) at 12350 (12:30PDT). Basis March $5 Dow (YMH2) intra-day trading the (3, -1) formula strategy that fades [(-1) of (3, -1)] the first move at 1.618% of the Stretch (35 x 1.618% = 56), from unchanged, 12338 - 56 = 12282. This long correlated with the culmination of the 3 January (3, -1) price projection target, 12296, [12416 - 40 - 40 - 40 = 12296] that hadn't been fulfilled 3 January. +68 points at $5 per tick = $340 per contract, ... = +68% basis $500 intra-day margin. Risk $45, nine points. Reward : risk ratio = 7.5 : 1.

The (3) of (3, -1) formula was not achieved. Counting (3) of today's Stretch, ... 12273 + 35 + 35 + 35 = 12378.
4 January 2012 high print: 12366 (12:41PDT). Settlement: 12356.

Offset rational: Very light volume in a narrow range following the first trading day of 2012, which printed a life of contract high doji candlestick. Back to back doji candlesticks on the daily chart is indicative of indecision at a benchmark high.

PBR's 6th annual Pro Rodeo events, tonight at Madison Square Gardens.
Cow tipping to be announced.