Rally To Continue?

I am long the DDM and the QLD from Friday's close. I did not get as good an entry as I had hoped as I entered with about 8 minutes to go and the indexes continued to fall strongly in those last few minutes. The Qs appear to have completed a small 2nd or b wave flat. There could be some downside Monday morning, but the 11/13 lows should not be breached. Any move above 31.97 in the Qs should trigger acceleration toward a high above the 11/4 high of 34.01.

The alternate view is that Friday's rally is wave ii of 5. If this is the case then we should know it fairly soon as wave iii of 5 should quickly take out Thursday's lows.

I am finding it easiest to follow these moves on the 15min and 60min charts, which gives me time to perform other tasks in between. Thursday's reversal developed as a head and shoulders bottom breakout around 2pm which completed as 5 waves up. By 1pm Thursday it was becoming clear that a rally was at hand and I began taking profits on short positions. If the markets do rally to the 50dema, I believe that it will be the last great short opportunity of the year, but it should be followed by one or two great long opportunities as well as large swings should be the norm until this primary wave down completes next year.

I usually don't have the luxury of following the intraday action, but I try to be in front of the screen when I think reversals could be at hand, and I use the intraday charts to determine pivots and entries whenever possible.

Throughout this year I have been developing my intraday trading methods. While there are any number that are profitable, I have been most interested in simple methods that allow the greatest flexibility from the screen. I have narrowed it down to two methods both of which consistently produce winning trades with few variables. My criteria for full time trading is that I should have enough capital to produce double my current income. That way, if I have a bad month I will not be under a lot of pressure to catch up. Once I have consistently produced income from intraday trading for at least 3 months, I will share specifics of what I am doing.

I wish you all profitable trading this week.