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Strategies & Market Trends : DAYTRADING Fundamentals -- Ignore unavailable to you. Want to Upgrade?

To: OZ who wrote (5132)	11/2/1999 10:28:00 PM
From: Dan Duchardt	Respond to of 18137

OZ, I have no intention of speaking for OZ on this subject, but I think the set-ups are similar to those used by some short term position, or swingtraders I have encountered. For anyone who wants to follow up on these ideas, there is a relatively new SI subject you might want to check out. Also, if you act fast, you can gain free access to a chat room where these techniques are followed. It becomes a pay service on Nov 15. These folks are associates of Ken Wolfe who runs #MTrader Message 11430478 swingtrader.net Someone asked for an example. Here's one from today that put together a number of factors: the 52 week high, a gap on the open, and finally breaking the daily high established in the first 1/2 hour of trading. Then it was off like a rocket. iqc.com The basics of the "breakout trade" is identifying a suitable candidate (e.g. consolidation intraday or on the daily) and a clear mid to late day breakout from the consolidation. Stocks that have pulled back from a high and formed a series of inside days are likely cadidates for a long breakout. The example, VRSN, had broken resistance around 120 last week to set the new high of 134 on Friday, tested it on Monday, broke it to 136 and then pulled back in the first few minutes this morning, consolidated, and then broke free. This example may be a bit extreme, and it was largely "news" driven (not just TA) but I think it illustrates the idea. The "stop" on this, if you buy the whole thing, would have been just below the consolidation. That would have taken some courage. I would not have gone that far, but I might have risked a couple of points on small shares. Dan