Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : LastShadow's Position Trading -- Ignore unavailable to you. Want to Upgrade?

To: eik who wrote (405)	9/16/1998 8:59:00 AM
From: LastShadow	Read Replies (3) \| Respond to of 43080

Gaps and CIEN I'd never enter a stock that had earnings warnings out - sorry I didn't reply to that one. Must have missed it. EDIT - see post 355 of this thread on 9/13 - I did reply.) Full Gaps - to use a full Gap strategy, the stock must open above (or below) yesterday's High (or Low). Modified Gap - to use this strategy, the stock merely has to open above or below the previous day's close (not necessarily the high or low of the day) AND must have substantial volume increase. For either method, one then looks at the first hour of trading to establish entry for longs and shorts, the difference for the fulll gap is that one uses the high and love of that morning as the strikes, and for modified (again remembering the volume) one can use several break points - but the simplest is to just use 75% of the difference between the open and the morning high to enter long and the low to short. Evvgen - no, you are correct - the stock would need to rise above the low of the previous day on a Gap down to signal a re-entry long. One needs to appreciate that these are general rguidelines, and one really needs to consider the specific stock to make a call. If the sector is moving, and it looks like momentum will carry the particular ticker with it, then go for the entry on the rebound (low of the morning followed by several upticks). The gaps were developed mostly for end of day type traders who could see the open and wanted to establish stops for longs and shorts when they couldn't watch the intraday. If you can, then you just have to take a larger perspective. lastshadow