Ways to differ 'good' gapping shares from bad ones?

[NasdaqTrader]

Hi Grey1, thanks for the post, it raises an important issue..

All traders need to be constantly monitoring their trade strategies to know whether each strategy is profitable or not. When a strategy is no longer profitable they need to either modify it or not use it anymore, which is what you have done, the sign of a good trader.

I agree that there are many sexed-up opportunities at the open. They are the exact opportunities that I look to trade by taking the other side of the trade.

I monitor every one of my trade strategy's success ratio constantly in a database. I monitor them also based on the time of the day that the trade was entered. The first hour of trading is consistently my most profitable time. And that brings up the second important issue, every trader trades differently. That is the beauty of trading, being able to trade in a way that makes you comfortable.

Thanks for sharing your thoughts, it is always a great way to learn by discussing strategies etc with fellow traders.

Best wishes

 

[Trade_Ideas]

Don't Discount Reversals

What about looking for gap reversals? Where the stock gaps down but then retraces the gap and continues upward?

Definition: A gap is when a stock changes price between yesterday's close and today's open. A gap reversal is when a stock moves in one direction between yesterday's close and today's open, then moves in the other direction after today's open. A gap reversal alert occurs when a stock price crosses yesterday's closing price for the first time since today's open.
http://www.trade-ideas.com/Glossary/Gap.html

I find these useful because once they completely retrace there exists enough momentum to continue and capture gains at a lower level of risk.

A scan for such plays can be found at various sites, here's one for US equities:
http://www.trade-ideas.com/SingleAlertType/GDR/Gap_down_reversal.html

Good luck

 

[clylbw]

Hi Trade Ideas,

Thanks for the information. Your own website?