Quote from geez:
Ok, this was a question about WLP short:
9:56 1000 WLP SHORT 49.10
STOP 49.30
TGT 48.70
* The chart above is not the WLP chart.
But I will give an explanation of what I was looking at and you can pull up the chart on your own (5 min chart).
First, look at the daily chart of WLP. Going into today it is extended up on four straight days of buying. Then it gaps up this morning and makes an extended run up on the 5 min chart.
Also, the indexes are doing the same thing. They gapped up and ran up on the 5 min chart. This is a clear to sign to me to put this on short watch.
This will be the most aggressive entry style you will see from me.
I watch the run up on the 5 min chart (the key being the indexes doing the same) and as soon as I see a red bar I short the very next bar if it breaks the low of the red bar.
The 9:50 bar on WLP is red, the low being 48.96. As soon as the 9:55 bar breaks BELOW 48.96 I look to short, looking for the reversal move because of the these major factors:
* extended daily
*gap up and run up on 5 min chart
*indexes doing the same thing
As soon as I get the entry bar up to hit it, it's at 49.01/49.11(I was watching UNH, PRU and COF at the same time for shorts). I was looking for an entry of 48.95, but after a long while of sitting there, a much better fill (plus a clear sign this is a spready stock)
I put my stop over the pivot high(also the HOD) of 49.29.
My target of 48.70 looks attainable...it's right above the 9:40 bars high, so the trade looks good, per my trading plan.
As the indexes turn and selloff WLP gets to 48.80 then reverses to the upside. Even as the indexes move lower and take out the lows of the day, WLP moves up. Add to this the spreadiness it has on the bid/ask and that's enough for me to move my stop to b/e (it got within .10 of tgt). As my last shares were covered this thing jumped up another .12...just to prove to me how spready it could be.
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As to the question about anyone taking my trades:
Feel free to join along, that's fine with me. But ,be very careful about these type of stocks. Try to have an understanding of how the spread can be very dangerous. Don't just jump in blind. Most plays I take are on very high volume stocks (or ETF's), and this is on purpose. I don't like spready stocks. I don't mind .01-.03 slippage on an exit....but some of these stocks (like WLP) you have to really watch.
Hope that helps explain WLP...any questions please ask...
Remember, there are no stupid questions...only stupid blondes.
Have a great weekend!-G
