Momentum Daytrading - Tricks of the Trade Message Board

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Strategies & Market Trends : Momentum Daytrading - Tricks of the Trade

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To: Kris who wrote (1353)	8/2/1998 2:01:00 PM
From: Rick Faurot	Read Replies (1) of 2120

Kris, Any stock in play can be dangerous. WCAP I believe came off $1 when its connection to COOL came out. So it was an internet/ipo play--very dicey. For beginners, the problem with any hot stock is seeing the huge rapid gains these stocks can make. AMZN will run up two or three bucks in a minute. Likewise XCIT, YHOO, etc. Smaller stocks can do it too, of course. As you noted, WCAP cleaned a lot of clocks on Friday because the COOL ipo got delayed so late and then only ran up a little. People were loading up on WCAP in anticipation of a huge run, but then the modest runup on COOL was interpreted as a fizzle and WCAP ate the cookie. But even before the COOL ipo hit, WCAP was unusually jumpy and this should be a warning to anyone. If you have some risk capital to set aside, it is okay to try this type of stock. Most of us can't afford to lose two or three bucks a share on a trade. The old familiar rule is beware of big spreads and rapid spread changes. This is usually a sign of MM manipulation and therefore trends will not be defined and playing into total unpredictability is like flipping a coin. Rick

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