Stops behind big volume

Discussion in 'Strategy Development' started by cashmoney69, Jul 18, 2006.

  1. I like to place stops a little bit below where high volume has supported a price in the past.

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    I have a chart here for google that I hope is clear. On a daily 3 month chart.

    1. 3/31 Spinning top on high volume with a low of 384

    2. From days 5/2 - 5/8 the lows here were around the highs from 3/31 (supported the price here for a few days).

    3. 5/9 google breaks out.

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    What i'm saying is.. Buy goog and use 382 as a stop (2.00 under) the 384 low from 3/31. As you can see on the chart, google brokeout before it fell below those levels.

    - Nathan
     
  2. daily