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Strategies & Market Trends : Swingtrading - Tricks of the Trade

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To: Ken Wolff who started this subject	9/22/2000 1:02:49 AM
From: Brandon	of 551

As most of you are probably aware, Intel came out with an earnings warning after the bell and was down a substantial amount on this news. Many stocks will react strongly in simpathy with this. I urge you to have a plan BEFORE THE MARKET OPENS. One situation that is especially difficult for traders to deal with is a gap under your stop. A scenario that no trader wants to deal with, but almost all who hold positions overnight will, is a "disaster stop". The important thing to remember about most gaps is that they will fail, or at least retrace part of it. When your stock opens, you need to avoid panic. Let the action of the open sort itself out and act after a good deal of the panic is removed from the market. Often the best thing to do is to let the stock trade for 5 minutes, which gets some of the paniced market orders out of the system. At this point you will make note of the low and that will become your stop. Should this low not be taken out you will manage the position as a normal DAYTRADE. Brandon www.swingtrader.net

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