Iterative Refinement
- Thread starter Spydertrader
- Start date
Hey all,
Attached is the daily chart for EHTH. As you can see, there was a pennant formation before yesterday, followed by a BO which I bought into. I kept the stock overnight since there was increasing volume and a BO pattern. I knew that yesterday was a up day for everything, and today might see a pullback, but nothing too drastic too quick.
Then today happened. The stock gapped down and stayed there. Lesson 1 - Put in my trailing stops before the opening bell. I got stuck with a stock that never really recovered. I thought it might around 3, but it failed to BO so I sold for a serious loss (my only loss for the day).
I guess my question is whether or not there was anything I could have done to forsee this.
Attached is the daily chart for EHTH. As you can see, there was a pennant formation before yesterday, followed by a BO which I bought into. I kept the stock overnight since there was increasing volume and a BO pattern. I knew that yesterday was a up day for everything, and today might see a pullback, but nothing too drastic too quick.
Then today happened. The stock gapped down and stayed there. Lesson 1 - Put in my trailing stops before the opening bell. I got stuck with a stock that never really recovered. I thought it might around 3, but it failed to BO so I sold for a serious loss (my only loss for the day).
I guess my question is whether or not there was anything I could have done to forsee this.
Hello all again,
I have been "fooled" over the past two days by two different stocks, CZZ yesterday and VIP today. CZZ looked like it was in the middle of its daily channel. VIP looked like it was at the top of a channel. They both shared a similar pattern. Early in the morning they shot upward and had excellent volume. I waited to purchase them, however, until they had their first downswing. Sometime between 10:00-10:30 they both had a spike in volume and a major downswing. I then purchased the stocks, because the daily volume was good, and they were still positive. However, once that happened, the volume dried up on both of them, and the price either entered a downward swing or stayed pretty stale Is this something common?
JF
I have been "fooled" over the past two days by two different stocks, CZZ yesterday and VIP today. CZZ looked like it was in the middle of its daily channel. VIP looked like it was at the top of a channel. They both shared a similar pattern. Early in the morning they shot upward and had excellent volume. I waited to purchase them, however, until they had their first downswing. Sometime between 10:00-10:30 they both had a spike in volume and a major downswing. I then purchased the stocks, because the daily volume was good, and they were still positive. However, once that happened, the volume dried up on both of them, and the price either entered a downward swing or stayed pretty stale Is this something common?
JF
5 min chart for Friday
See post above for question...
See post above for question...
1. Understand the difference between a Pennant and what exists on your chart. Hint: EHTH doesn't show a Pennant.
2. Understand what happens when Peak Volume arrives.
3. Stop looking at 5 minute and 30 minute charts until you have a rock solid understanding of the Price / Volume Relationship on the daily fractal.
- Spydertrader