It was a quiet start to the week. A few moves, but relatively subdued. Tesla though, can usually be relied upon to give us something interesting to do. This is what we got:
It was a fairly straightforward trade. The only thing to remark is that it looked like there might have been an earlier entry. Why didn’t I take it? This is a classic case of the chart not telling the whole story — although it did leave a massive hint. The answer of course is that there was no momentum behind the first move, as we can see from the lack of volume.
In real time, when we are watching the chart unfold, we can’t wait for the volume bar to finish printing to let us know whether to enter or not — by then it’s too late. But in real time the lack of momentum is clear on the tape.
When the second move came along, the volume and momentum were there to push things along nicely.