Trading gap ups

C

Corky5

This is one of the most dangerous forms of trading. We all get tempted to buy those violent gap ups especially when we have been witnessing many with no pull backs. However, sometimes its best to sit back and preserve capital.
 
Not exactly.

There are basically 4 types of gap...

Gap-n-go
Gap-n-crap
Gap-fill-resume
Gap-half-fill, resume

Gaps are always one of these. Not especially risky... play them as you will. (You have to guess as to which you think this one is... "on the fly".)
 
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Scataphagos said:
Not exactly.

There are basically 4 types of gap...

Gap-n-go
Gap-n-crap
Gap-fill-resume
Gap-half-fill, resume

Gaps are always one of these. Not especially risky... play them as you will. (You have to guess as to which you think this one is... "on the fly".)
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Well said. Over 21 years my best trades are minor 2day high gap continuations for stocks and ETFs priced $15-$40.

The worst gap-n-crap charts are the low float insanely stupid under-$10 pos stocks that are frontrun by bs young poser gurus in chatrooms.
 
Usually, I wait for the pullback. That gives you a chance to make so monies atleast. Better still, if you got into position before the gap up. :D
 
Corky5 said:
Trading gap ups certainly isnt for the faint of heart. Look at FFIV today.
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That is for sure. Do not play gaps but, if I did, I would have entered on the open. You would not have the whole 10 points but, you would have 5 points profit. Better still, since, it was going sideways, you could buy at the support level. Sell it at the resistance level. That is about 9 points. This is from a daily chart. Would have preferred a strongly, trending stock instead.
 
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