Be in 2 Places at Once to Nail Your Next Gap Trade
Source: http://marketmovers.blogspot.com/2009/04/be-in-2-places-at-once-to-nail-your.htmlPosted on Tuesday, April 21st, 2009 | In Investing Lessons, Stocks to Watch
The market is expected to open lower this morning for several reasons (all from my Twitter feed this AM):divdivollia href=”http://twitter.com/SmallCapInvest/status/1574513945″SmallCapInvestOil/a: prices languished near $46 a barrel Tuesday after renewed doubts about the health of U.S. banks sent crude and stock markets tumbling.br /br //lilia href=”http://twitter.com/alansmurray/status/1574549641″alansmurray/a: Caterpillar and DuPont earnings raise fresh concerns about economic weakness. a href=”http://bit.ly/IjQ7S”http://bit.ly/IjQ7S/abr /br //lilia href=”http://twitter.com/SmallCapInvest/status/1574502742″SmallCapInvest/a: Stocks are expected to open lower for a second day Tuesday following a string of disappointing earnings reports.br //li/oldivGiven this news I will set up 2 strategy windows. The filters for each strategy would profile the kinds of stocks I like to trade based on price range, volume profile (e.g., ADV, higher than usual volume, etc.), and volatility (e.g., ATR, etc.). /divdivbr //divdivThe 2 strategies differ in the following ways but be similar in their approach: each will alert to specific stock activity/trade in the same direction as the overall market. I achieve this by using the market direction filters: a href=”http://www.trade-ideas.com/Help.html#WSF_MinQqqq5″http://www.trade-ideas.com/Help.html#WSF_MinQqqq5/a/divdivbr //divdivOne strategy window will use the “Recent Gap Down Reversal” alerts: a href=”http://www.trade-ideas.com/Help.html#GDR”http://www.trade-ideas.com/Help.html#GDR/a to find the stocks that gap down and then fill the gap and continue to rise. The overall market filters for this strategy will be positive – meaning that the Qs and/or Dow and/or Samp;P must be up at the time of the stock alert. /divdivbr //divdivAnother strategy window will use the “False Gap Down Retracement” alerts: a href=”http://www.trade-ideas.com/Help.html#FGDR”http://www.trade-ideas.com/Help.html#FGDR/a to find stocks that gap down, try to rise and fill the gap but then fail and wind up trending down below the original gap amount – like a reverse cup and handle. The overall market filters for this strategy will be negative - meaning that the Qs and/or Dow and/or Samp;P must be down at the time of the stock alert. /divdivbr //divdivI’ll leave you to design the strategies given this description and you’ll be ready for today’s open or another day that points to the same opening pattern./divdivbr //divdivI’ll post again with the results of these strategies later./divdivbr //divdivGood luck./div/div/divdiv class=”blogger-post-footer”img width=’1′ height=’1′ src=’https://blogger.googleusercontent.com/tracker/9446784-3518105280350980609?l=marketmovers.blogspot.com’//div
Last 5 posts by David Aferiat
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 About David Aferiat (http://www.trade-ideas.com/)
David brings more than 11 years of experience in trading, consulting, software, utilities, capital markets, and consumer product industries. Working with senior officers and key decision makers in the board room, finance, HR, marketing and trading functions, he has advised both public and privately held companies with revenues ranging from $20 million to $14 billion. Work at Trade-Ideas taps experience in business development, customer acquisition and retention, corporate strategy as well as energy trading and marketing. David holds dual Bachelor of Arts degrees in Economics and French from the University of Texas at Austin and a Masters of Business Administration degree from the Cox School of Business at Southern Methodist University. In four years Trade Ideas has grown to over 35,000 accounts in 19 different countries. Hedge funds, Asset Managers, Institutions, Online Brokers, and direct access traders use the software as a premier idea generation, risk management, and decision support tool. |
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