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Biotech / Medical : VD's Model Portfolio & Discussion Thread
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To: Vector1 who wrote (9177)3/10/2002 5:58:08 AM
From: Rocketman   of 9719
 
When I saw how SEPR dropped, I thought that it might make the deadcat bounce, and sure enough it did. Interesting chart. Look at both Thursday and Friday and you will see how they drop at the open on all the market sell orders placed during the previous night, but shortly after that initial opening sell off frenzy, the bounce occurs as it hits bottom, the surge in sell volume dries up and the stock gets a little spike. You want to buy in the few minutes after the opening market sell orders are all filled.

On a deadcat play you don't want to try and get greedy, just a small quick return of a couple of percent. It's one of those plays where an hour or two is a long time to be patient and hold the stock. For instance on Friday, just minutes after the open the stock hit its bottom for the day. Within half an hour it is up about 5% as the daily bargain hunters are picking up shares, it then slides all day long and ends up closing just a bit above its morning low. I don't have a daily chart of Thursday up, but from the 5 day it is still clear that this pattern also prevailed on Thursday, with even a bigger chance for a gain.

Pretty typical pattern for a stock that just lost half its valuation in a new driven event. Just the vestiges of a market overreaction.

Rman
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