Being day traders we are always focused on what is happening right now.  The mistake some traders make is focusing too much on level 2 and the 5 minute chart.  These traders who are focused on the shorter timeframes end up basically chasing momentum.  The bigger money in this market has been buying pullbacks in strong stocks.  Personally I have been working on this concept. 

Now I am classifying strength by looking at the daily and hourly charts.  Stocks that are trending up for a few days are on my radar.  I am looking to buy these stocks the day after they show weakness and trying to get in when they break significant levels to the upside.  The sector that set up perfectly for this setup yesterday was the gaming sector and specifically Las Vegas Sands (LVS). 

On the daily chart LVS has been basically straight up from 15- 19.85 over the past 11 days.  Then on Monday LVS broke the 3-day box to the downside and sold off hard.  It was a strong downmove but looking at the big picture was basically just a small pullback.  Coming in to the day on Tuesday if you were game planning correctly you should have been looking to go long LVS if we broke to the upside.  Obviously looking at the charts now it was a great trade.  What I am trying to do with my progress and what I am aggressively trying to work on is identifying these setups when they are happening.  The bigger money in this market is catching these 1-3 day moves and these are the setups that will help you get in to these setups. 

Looking at LVS above 20 going into today if we can stay up there.  Best of luck in your trading and happy St. Patrick’s Day. 


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