Ivan,
Do you have more PGDCEBs on your current list than the following candidates: SGI, ACTM, TSEMF, FMRX, TRKN, PETD? Also do you have the ability to scan for stocks that have had a 30% plus downside gap in the last 3 months to find more? It's easy to add new candidates by looking at the largest percentage losers everyday, but for days past I don't know how to find them.
Here's a strategy I'm concocting. I can set alarms on the candidates based on price and volume, and therefore be alerted when a signal day may be occurring. At this point we watch the intraday chart or perhaps level II for signs of an intraday turnaround, and pounce. I hope to become somewhat familiar with the kittens by observing the MMs behavior beforehand in these issues to get a feel for whose movement in meaningful. At this point we play it strictly based on the any trends that develop on the 5 minute chart, cutting any losses if the day's low is breached. If a positive trend develops, we take profit if it deteriorates. If things go well this could be a several day play. At some point that trend will break and we'll go back to monitoring the daily chart for another low that is higher or equal to the low of the signal day. If this happens there will now be a trendline that can be established on the daily chart drawn from the signal day to the new higher low. At this point we reenter with the hope that a new trend line will provide support, and exit when it breaks. If the signal day low is breached, it's back to monitoring for a new signal day. It seems there should be a time limit that when expired we discard the canditates based on the fact that the gap is now in the too distant past. Any ideas on a time limit value, Doug, if you're reading?
Here's some thought behind the stragegy. There seems to be some strong movement on or immediately after the signal day, but the risk is high that this is just a corrective blip and new lows will be made as soon as the next day or two. Playing it like a day trade at this point with close stops limits the risk here somewhat. After a higher low on the daily chart is established (probably a week or so later), the risk is somewhat lower, and we can give it more room to make the kind of bullish correction one would expect from a stock that has fallen so dramatically.
I have daily charts for all of the current crop, and intraday also that only goes back 30 days. So I'm checking those to get an idea how this stragegy would have played out for signal days that occurred in the last 30 days.
So there's an outline of my thoughts on playing the PGDCEBs? I welcome your input, Ivan, and anyone else who's interested or has something to add or subtract. No need to pull any punches here, I'm not married to these ideas.
I'm working on the list I have now and will report the results soon.
Esteban |
