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Strategies & Market Trends : Momentum Daytrading - Tricks of the Trade -- Ignore unavailable to you. Want to Upgrade?

To: Ken Wolff who wrote (514)	2/15/1998 4:51:00 PM
From: Joe W.	Read Replies (1) \| Respond to of 2120

Ken ... an observation on open shorts I was fascinated to discover your open short strategy (pattern as you call it). I wrote a scan and system test for Metastock and started to randomly scan stocks (NASDAQ & NYSE) in my "core" database ( stocks between 15-25 dollars with an avarage true range of over 1 1/8 pt over the last 30 days ). I shorted at the open, all stocks in my "core" database that gapped open more than $1.00 at the open. The results are very promising. Of course this test is on end of day data, not intraday data. The added advantage of watching what happens to the stock at the open in real time could only improve my results. Looking forward to trading this setup when I become a full time active daytrader in early March. Thanks again for sharing...

To: Ken Wolff who wrote (514)	2/15/1998 10:43:00 PM
From: Pullin-GS	Read Replies (4) \| Respond to of 2120

Here is a new trick that has not been mentioned yet. It could use some tidying up around the edges, but the idea is sound (and proven). **Sell on newsletter Hype play. I subscribe to several very large and free newsletters by email...one excellent example of which is Future Super Stock Newsletter**. Many times these newsletters have paying customers who receive the newsletter before "the free masses" receive theirs by as much as a week or so, giving these people plenty of time to accumulate. You also have those newsletter "insiders" who know whats up before even the paying customers are in. Upon receiving an update, I will plot the technicals of the stock, and note the action relative to the 1 to 3 weeks heading up to the public release. Often these plays are low float, low price securities with a tempting story that will cause many a new investor to jump on board. As is often the case, the stock will spike hard on the morning after the release (the newsletters most always comes out on fiday evenings....hmmmm) and new highs are reached very quickly....but then low and behold, it often tanks! Just where is the selling coming from? I won't say where I think the selling is coming from...but I think you know what I think. ;-) Anyway, on the morning after a runnup, I will at times short these plays on a "sell the news". I never would think of buying in on opening day after a news letter release. It is unhealthy for your captital.<G> Regards, Paul