How to manage a choppy stock and gap up

Discussion in 'Trading' started by ShadowTrader_08, Apr 3, 2009.

  1. ShadowTrader_08

    ShadowTrader_08 ET Sponsor

    This may be of help to a lot of people because its often typical action that is hard to manage.

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  2. when you have any holding, just put a stop sell $0.3 low of the opening price.

    if the stock dropped a lot, then gap up, you need consider: buy back if your holding is stopped out. since in this case, the stcok will go higher from the gap up(short squeeze, most time it is bearish, suddenly it is bullish, people can not change its view quickly)

    of course, like today, RIMM, rimm gapped up to 64+ in pre-market, I bought it at 61 in the pre-market, then I sold it at 63.8 (pre-market has no stop-loss or not good for stop order), so I just sold it. then I saw it dropped, I shorted it at 63.5, plan to cut loss at 64, but I was right. RIMM tanked to 58~59, I just covered it there. from the closing, it is bullish, so I bought it at the closing, it will continue to rock.