Wednesday, August 11, 2010

BUY TNA blended price $38.52

I made five purchases of Direxion Small Cap Bull 3X Shares (TNA).  This initial purchase was at $39.50.  The second purchase (see next chart) was at $39.20.  The third purchase (fifth chart down) was at $38.50, fourth at $38.00, fifth at $37.40.
I have recored these five purchases as a single transaction in my TSI trading record - one buy (average price) at $38.52.
This first DAILY chart is ugly but the following four charts will show you what I am thinking in taking this trade.
Click on the charts to ENLARGE
This is TNA on a 60 minute chart.  Notice the huge positive divergence of price with respect to both the True Strength Index (TSI) and Money Flow Index (MFI) indicators.  Also, these moves that take price clear out of the Bollinger Band rarely stick.

This is a 5 minute chart of the US Dollar.  I use what is available to me, which is the MACD in proxy for the TSI.  Again, the divergences suggest the US Dollar will not be able to hold this level, thus the stock market should begin to snap back.

This is a look at the US Dollar daily chart a little over one hour past the start of trade today.  The US Dollar surpassed the 50% retracement of its most recent down leg, and has now completed a 61.8% retracement in the past hour.

This is my third (and final) purchase of TNA today.  I don't think this is the follow through reaction Ben had in mind for his speech.  LOL  Cooler heads will prevail soon then we'll see where that takes us.

Well maybe the last purchase was not my final, and this one is for $38.00 - TNA. (?)

This is my fifth purchase of TNA today.  It is the final purchase for today because, the market is now closed.  $37.40, my breakeven price is now $38.52.

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