No such thing as a pest on this thread - its for asking questions and getting better at this.
AOL - you shouldn't short after 3:30 unless is absolutely dropping in price with more volume and number of trades. The reason is that the morning 10:30 look at the stock's movement tells you where you can expect the price to be bound by midday. If it blows above or below those stops, then you can ride it in the direction its moving for the next coupleof hours. If it hist the morning low after 3:30, and you see increasing trades and volume (as in AOL) and the ticker starts to oscillate, that means its hitting a floor and it will either plunge below it or hover for a close. If it was a selloff, it would have plunged and the short would be good. If it was a rebound, it would start by 3:30. hovering there means the floor doesn't know what tomorrow will bring, so the intraday shorters bought to cover and the speculative longs are in it now. At any rate, AOL opened justshort of 96, and then dropped and jumped back up screaming all theway to 100 - however, there were only a few buys at 100, and all the trades at 99.625 were buys and not sells, so I set the buy stop at 99.5, figuring I could set a sell stop immediately after at 98.5 and risk a half point. The bid/ask spread when AOL was at or below 96 was in half point increments! Therefore, I could short at 95.5, figuring it would fill at the uptick, again risking a half point to the upside if it floored and rebounded immediately. Again - therse were all assuming the trades were bing watched intraday - end of day or delayed your stops were just what I would have used.
INTC - midmorning low was about 82.625. That was just before 11 - I didn't use the 10:30 price as the stock was still downtrending and you want to wait and see if it hits the opening price ($82 - in which case you would buy for the rebound). In reality, for a daytrade I would have pulled out by 3:45 or so - the final drop came too late in the day for most of us to have traded it cleanly (SOES trader could have done it though). You have to ignore single spikes like the one opening bid and the one at 81.125 near close as there were no other trades at that price - someone was slapped by the mm, and it wasn't a collective pricing that all the mm's handling INTC moved with. you want the trend, not the detail.
CSCO stops were the same, so no comment there |
