Gapper / Cup & Handle

The lower $USD was a good opportunity to focus on lagging commodities, steel and coal, or as some people are calling it, the reflation trade.

X gapped up, carved a couple of inside bars, and broke out of its base with a fast move to the 50% fib. extension.

ACI also ripped higher after gapping up, but I caught the secondary play, after it consolidated the first leg, or the C&H breakout. As you can see from the chart, it was a slow, but steady move.

SOHU gapped lower and carved out an inverse C&H. I especially liked the price/volume contraction at the base of the round $ number just before the BO. Ultimately, I was expecting a wider extension from such a perfect base, but it didn't even reach the 38% FE of the ORH to the base. I thought it might form a mini bear flag and continue but it didn't.


The finer details of entry and exits are highlighted on the 1 minute chart below. The straight blue lines are the initial base, followed by consolidation points on the way down. See how the blue lines come into play as price retraces and then begins to fall down again.

NKE was an earnings gap that looked way too choppy in the early going, but eventually, it carved out a C&H base. The second BO bar, was a shooting star and I moved my stop just pennies below the base and BE. Surprisingly, after such a whip saw start, it rallied up to the next $ level and the 38% FE for a fast trade to cap the day.