Gap Up tomorrow morning

Quote from waggie945:

Grob, very interesting.

ET could certainly use a lot more posts where people "share" their trading methodology.

Well done!
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YVW. Anytime. I really hopes it helps out.
 
Quote from Grob109:

I have posted in a couple of places the last few days on threads dealing with gaps and making money. (I don't know how to cite the places, search my name)

If you are doing continuous trading, then you may wish to make money every evening as well.

Use the IT trend to determine direction of hold overnight.

Attached is the print (beginner using scaling and reversals while being mentored) that covers this thread's afternoon discussion. I annotated it for clarity if you are not used to staying in the market and doing trading all the time.

Add three hours to get time correction for eastern time.

What you see from bottom up is a reverse into a short S to B for two ticks on one contract. This sets up a long on a reverse B to S on one contract; it turns out to be a wash. Next is a 1 contract short for 1 point.

Now the reverse of 1 contract continues and another contract long scales in. As a reverse, these two contracts are covered for a total of three ticks with a reversal to carry 2 contracts forward in a short trade.

The power of staying in the market on the right side of the market shows up here. The B 2 @48.1 yields 3.3 x 2 in points for 7.2 points. The spike was not handled well either as an exit nor as a reversal. This is a consequence of emotions coming into the picture (popping in as a surprise) as a consequence of the past leaned behavior.

22 minutes pass as the trader gets himself debriefed and back to 1 contract (SeePTJ). The S toB short is annotated as the last trade (red) of the day (15:57). It makes 3 ticks.

After NYSE close, the overnite is taken by acting according to the IT trend. This is the top line annotated in black. Since the day has been one where the prior over night gaps (see my posts) all follow the IT, you get to make around the H/L of any intraday range when anything is available.

there are ET comments about how gaps are 50/50 up and down. That is true because they follow the IT trends in groups of up gaps and groups of down gaps. If an IT trend ends overnight, you have to consider that as a possibility.

Obviously overnight trading is more risky; just check the margin requirements as a rough measure.

I am not posting on this to get into a long discussion. If you wish you can collect about four or five former posts over the last week or so to see the picture sufficiently to make a major increase in your rate of capital appreciation using this.

To clarify R (Resistance) considerations here and how a long IT trend relates, here is what to conclude. You will not get a gap if the overnight is testing the top of R as it will when the close is on the top of R. That is not complicated. When I say you will not get a gap that means not up or not down, neither, nada. If the other condition prevails, i. e., the close is NOT on the top of the R, then you will see a gap; It will be approximately equal to the the prior H/L range distance away from the top of the R in potential.

Occasionally there is earth shaking news etc. So what. We all know what to do whith news. There is a recovery from news that is just like Ari Kiev says about emotions. He says time it. LOL.
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Thanks a lot Jack. That is a very impressive trading log. I am not at SCT yet but I will get there eventually. Therefore, i will hold off on tradign gaps as you suggested. Your prior posts is what got me to be more conscious of gaps. You always seem to just pull another chapter out of your trading textbook. lol.

I'll have to read your prior posts on gaps a few more times before it sinks in.
Thanks again.
 
Quote from vhehn:

agree. i bought a few things at lod close just for that play. probably try to sell into premarket tomorrow.
almost all of the lod closes recently have had some kind of a gap the next day. we will see. in trading you make your bets and play your cards. whats the old kenny rogers song:

Know when to hold ‘em, know when to fold ‘em, know when to walk away, and know when to run.”
- Kenny Rogers
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amat intc csco qqq all worked.
 
Quote from Grob109:



there are ET comments about how gaps are 50/50 up and down. That is true because they follow the IT trends in groups of up gaps and groups of down gaps. If an IT trend ends overnight, you have to consider that as a possibility.
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I think this could be very very useful(especially for equities). You can use the Gaps to indicate when IT trends are changing. That was a big question of mine. If we break the right side of an IT trend, how do we know it is creating a pt 3 for the long IT trend or the start of a down IT trend? From what i gather, you anticipate a pt 3 and gap toward the IT trend. If you dont gap toward the IT trend, then their is a good possibility of starting a new IT trend. This is still new to me so my logic may be wrong. Just wanted to throw out a few thoughts.
 
I went out at 49.0 at open. the gap was under three points and the overnight high was 2 points higher than 49 at 51.

The post above brings up many Q's. I have to work right now I will comment later.
 
amat intc csco qqq all worked, yes u made a dime, but lrcx wouldve killed you or any other semi or networker if you hadnt sold immediately, this may have conditioned you to holding overnites, one day the mkt will open down big..
 
Quote from areyoukidding?:

amat intc csco qqq all worked, yes u made a dime, but lrcx wouldve killed you or any other semi or networker if you hadnt sold immediately, this may have conditioned you to holding overnites, one day the mkt will open down big..
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i hold overnight all the time. that doesnt scare me. i am mostly swing a trader. over half the gains in this bull run have been overnight gaps.
i love big down opens. we havent had many lately but they are sometimes the quickest money made if you do open orders.
 
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