Something i notice many traders use

[NoDoji]

Quote from gucci:

What do you mean with "common"? Non-functioning?

It doesn't make any sense to use stop losses there.

What I meant is that many traders reverse their position when stopped out. So if you're long a stock near its LOD and it breaks down the LOD and hits your stop, many traders would then short the stock, assuming that such a breakdown means further to fall.

 

[vingbel]

Quote from Anaconda:

You have to note volume as well. Scanning new daily highs & lows may find you a stock in play that is getting sold or bought by an institution. You also have to look at the chart. Most of the new highs & lows are just chops. But those where it is obvious the stock has been accumulated or distributed around a tight price range and is now breaking out of it with decent volume is a good play.

I agree, but so many posts say you can't tell anything with volume.

What would you say is the rule of thumb when using volume to determine what constitutes a significant high or low?

 

[T-rexx]

I guess if your strategy is to trade with day highs and lows, you better implement Support/Resistance on your plan. Even though you have a strong high or down, you better hold back for confirmation.

 

[gucci]

Quote from NoDoji:

What I meant is that many traders reverse their position when stopped out. So if you're long a stock near its LOD and it breaks down the LOD and hits your stop, many traders would then short the stock, assuming that such a breakdown means further to fall.

Thanks for clarifying.