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YMH2, (3, -1) formula, fade 1.618% Stretch 6 Feb 2012


Hi,
6 February 2012: Basis fading the March $5 Dow (YMH2) futures first intra-day counter trend move by 1.618% of the Stretch (12793 - 63 = 12730... 12722 = low) produced a profit on a closing basis, but did not complete the (3, -1) sequence. [Look back to 25, 26 January open/close and a few Fibonacci calculations within the intra-day price corrections on the daily chart.]

The (3, -1) fade at 1.618% of the Stretch produced a profit for the trading day, 6 February 2012. Though the (3) of that (3, -1) price measuring objective from the 6 February low, 12722 + 39 + 39 + 39 = 12839, was not achieved until today, it is at the same level as the 7 February 1.618% of the Stretch above unchanged, 12776 + 61 = 12839. On a closing basis the 6 February fade at 1.618% of the Stretch below unchanged, i.e., long at 12730, was profitable on a closing basis. 12730 = 46 = 12776 settlement, ... 46 points x $5 = $230 per contract which is a 46% profit basis $500 intra-day margin.
Even if you faded at the previous settlement less the Stretch, i.e, 12793 - 39 = 12754, a the trade produced a profit on a closing basis, 12776 - 12754 = 22 points x $5 = $110 per contract, which is a 22% profit basis $500 intra-day margin.