Write the rubber-band long before the fill

Four conditions, one long

In editorial terms, this is a rubber-band name for a stretched-from-value mean-reversion long. The archive case did not treat that stretch as a trade by itself.

The case defined four concurrent conditions for a long: a weekly descending wedge that had already resolved upward, heavy volume that marked a low then a new low, a stretched-from-value mean-reversion setup, and a high short-interest backdrop. Those four factors were held as one assessment, not as four separate reasons to buy.

Impulse wave confirmation

The weekly upside resolution of the descending wedge was treated as the Impulse wave confirmation once price closed back inside the envelope and the impulse reading turned blue. Until that close and that reading, the weekly event was not counted as confirmation.

MACD as the daily timing cue

Daily timing required a MACD crossover after the volume-driven sequence of a low, a new low, and subsequent stabilization. The crossover was the timing cue. It did not replace the weekly Impulse wave confirmation or the four-factor screen.

Entry, invalidation, and first target

The written plan specified a buy on a slight pullback to the February 8, 2010 high of 4.10. The invalidation stop sat under Friday's range low at 3.93. The first target was the prior break low of 4.90, which matched a July 2009 interim low. Those three prices were part of the same Rule-based entry procedure.

The pullback fill

Execution followed the pullback rule. After a holiday-delayed open at 4.15 and a rise to 4.19, the fill occurred at 4.11 when price returned to the planned 4.10 area.

Staying with the written plan

The trader still took the fill despite hesitation that a false breakout might be forming. The four-factor assessment was the reason to stay in the procedure rather than abandon the planned pullback.

First check against invalidation

After a pennant-type consolidation, price broke the session high and closed strong. The write-up presented that close as the first confirmation that the entry rule had not been immediately invalidated.

Editorial reading

The archive value is the order of work. Impulse wave confirmation, MACD timing, the 4.10 pullback, the 3.93 stop, and the 4.90 first target were specified while the long was still unfilled. Hesitation about a false breakout did not rewrite those rules. The later strong close was only a first check against immediate invalidation, not a statement about later results.