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Non-Tech : MB TRADING -- Ignore unavailable to you. Want to Upgrade?

To: cool who wrote (514)	7/14/1998 7:23:00 PM
From: Sword	Read Replies (1) \| Respond to of 7382

How to determine if declines are probably shakes that will rebound: 1. They occur most often at the end of the day. Reason? Daytraders don't want to end up with a losing trade so soon to the time of day that their rules say is termination time for all positions. MMs know this. 2. Look for consolidation around an integer price level; e.g. 200 for yhoo, 20 for EGGS, etc. There are normally lots of sell stop orders and buy stop orders at these levels put their by less knowledgeable investors. These are targets that traders and MMs will aim at reaching. They will sell short in order to drive the price down to that level, it will be breached and the subsequent momentum will carry the price to levels far below their short sale prices where they will cover. 3. You mentioned volume as an indicator. Yes, this can be a sign. Contradictory with tight stops? Yes it is. Get a feel for where the shakes might occur and get out before the run happens, while the action is evenly divided between buying at the ask and selling at the bid (red/green are 50/50)and then wait patiently for the run. Then buy below the consolidation price level when the selling action slows (but doesn't reverse). If you misjudge the situation and get caught in a run, wait and evaluate the situation. Is it likely a shakeout? Then you're better off taking the chance of staying in and waiting for the bounce. (Keep an eye on the indexes like the nasdaq composite and the dow jones to make sure that the run isn't a market crash.) -Sword