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Gapup

Brief Retracement Before Surprise EarningsLeadup Before earnings, SACH's price fell about 13%. SACH reported a surprise above expected EPS. Price Action After reporting a surprise, price gapped up and began consolidation. Today that consolidation broke upwards with a substantial gap and moved towards its previous highs. Indicators Volume Broke 21 MA on the gap. DI remained bullish, and ADX seems to be finding support at the 20 level. RSI found support at the 50 level. This level has been significant in the past.
AMEX:SACHLong
by Ronald_Ryninger
Anatomy of a Day Trade: Entrances and ExitsO FGS! Dammit! They gapped it up overnight, what should I do?!? Well what gap is this? Three weeks ago we had Initiation Gap: These often do not fill, don't short them! It's suicide, lol! This has hallmarks of an Exhaustion Gap; it will fill intra-day or within a few sessions at most... a great short opportunity! See my related post on gaps FYI. But, when should you enter?! If you foolishly short it at the open be prepared to wait for hours and watch your position dwindle... ow!! Should you buy calls at the open?! Maybe it will run higher?! Of course it CAN, but it can also run lower and gapfill quickly, within minutes. A long position taken first thing is high risk... as are early shorts! So, when can you enter a position with reasonable expectation of profit?! In fact, ANY position taken in the first 20 minutes of the trading day is very high risk, I do not like to open new positions right away! So, you Watch and Wait! Looking for opportunity... in the first hour price ran higher and calls had been profitable, but we didn't take a position with no signal, we like good Risk/Reward positions with clear signals, not gambling on the opening price. After what seems like an eternity, price begins to consolidate and gives us several warning signals, first a pinbar appears, with a needle doji and tall wick followed by a red candle, a bearish signal; two spinning tops follow, but price clings to the opening price support line tenaciously as the bulls struggle to push higher... finally the price breaks below the support from the opening gap. This was the price support that market enjoyed from the open, as buy order imbalance filled, RSI weakens and money flow decreases until... price breaks under the opening price, signaling downtrend moving towards the gap. Notice how RSI moves from overbought, signaling weakness? This is a short entry high R/R position. You can buy daily puts here with confidence they will increase in value rapidly and immediately. You do not want to get stuck holding these dreadful instruments more than half an hour, you can see the value drain out as expiration nears! Well we see the gap filled, not completely to yesterday's closing price, but it sold down to former resistance at the high prices from last session. This often is all you get on a fill, it won't always close precisely! Sometimes price will dip below the gap and go negative for a few minutes. When the gap fills, you close position, we can't afford to gamble on whether it's gonna get lower or not... Suddenly an impulsive bright green candle appears! Gosh I hope you sold those puts! Notice how RSI has moved nearly to oversold? It's gonna bounce!! NOW is the time we make the best money. This was the candle we saw on 7 October, pullback ran to 13 October; another one appeared on Fed day at 2PM, pullback was just minutes then it bulled up and up... these are the money makers! Learn to recognize this chart pattern and you WILL make money on option trades. You can take a moderate sized position here, I like to trade lots of ten, when I see this candle I'm gonna start with 20-40 calls depending on cost, and add more as price moves in favor. I do not like to add when price moves away! USUALLY Dollar-Cost Averaging in options just leads to magnified losses!! The more you take the greater the loss you might experience, remember when you enter an option trade you assume the total risk for premium paid, a sudden price change can wipe out your position before you can even set up the closing trade. So risk what you are willing to lose, and no more. After the first impulsive move, a retracement nearly always pulls price back to ~2/3 of the impulse height. Here you draw the fib extension to get your target price projection; Fib Extension tool has three buttons, first at bottom of green candle, second at top, and third at bottom of the retracement. Chart your fibo and target the 1.618 extension, this is where your calls will take you! They might take you farther, but that involves more hand-wringing, nail-biting and screen cursing while you wait and watch the time value run down! Do not hold these any longer than necessary! So there were TWO good R/R day trades in Friday's session on 11/5. A short, and the subsequent long. You could have taken other positions, but R/R would be poor, most 'trades' without signals are just gambling. Be a trader not a gambler! Most of the time you want to stay OUT of the market! Look, today's trades involved about two half-hours out of a 6.5 hour session! The rest was just noise and risk. Notably, in 'Power Hour' at EOD, there was not enough bullish energy to lift price back to HOTD... this is Bearish, in a long bull run Fridays typically close at HOTD and short-covering rallies into close are typical, we didn't get that today and daily calls ran down to expiration worthlessly. You might consider taking a longer-term short in weekly or monthly contracts, to catch a move MOnday if the price weakness persists and a gap down follows the exhaustion gap up... if you dare. Remember Buffet's rules of trading: 1) Never Lose Money. 2) Never break Rule 1. Hopefully this post will be of some value of increasing clarity in trading. When you're in the market watching the numbers flicker it is so easy to get lost and miss the forest for the trees... Get ready for some amazing trades as this parabola rolls over and the cascade ensues... always exciting!!
TVC:SPXEducation
by DaddySawbucks
7
PH had a strong earnings gap up!* Great earnings * Very strong up trend * High relative strength in the Industrial sector * Broke out of a ~7 month consolidation period with very high volume (162.6% above average) Note: With very high volume on earnings, this very well may be a break away gap and may continue going higher from here. Trade Idea: * You can enter now and ride higher. * Or you can look for buying opportunities near the $321.65 area * A daily close below $321.65 would expose $311.70 as the next key support which should hold firmly.
NYSE:PHLong
by HaseebKhan_90
BBVA Strong Opening GapBBVA is a Spanish bank that provides retail banking, wholesale banking, asset management, and private banking services. It offers banking services in Spain, Mexico, South America, the US, Turkey, Asia-Pacific, and Europe. This morning, Oct 5, BBVA opened with a substantial opening gap clearing two areas of S/R. Since Nov of 2020, BBVA has been in a solid upward channel. This gap comes after a recent test of the bottom of the channel. A volume spike accompanied the test of the bottom. On the daily chart, RSI and ADX both show an upward trend with room to run. However, the ADX does not offer much conviction. When looking at the weekly chart, we see the same lack of confidence in the ADX. But RSI is signaling a solid bull trend. When trading gaps, I place the stop loss at the high of the previous candle. If the price whipsaws and closes the gap, I want to be out as soon as possible. I placed it at 3:1 RR for the profit target since it is slightly lower than the top of the channel.
NYSE:BBVALong
by Ronald_Ryninger
AAL: Invisible BreakoutAAL made quite the move during the nights of April 23rd and April 26th, and that move was a gap up above the downtrend, with an open at $21.46 and a close at $22.00. This invisible move is very bullish, as AAL was in a downtrend for about a month and now the gap up has broken the trend. We failed to break $22, and are now ranging between $21.64 - $21.06. However, before we get too excited for a continuation, I presume the gap will be filled ($21.21-$21.46), as we gapped through a pretty major price level, as previously mentioned. Statistically speaking, gaps have about a 91% chance of being filled according to bioequity.org. Once this level has been cleared, I anticipate a continuation of the breakout by breaking out of the established range and continuing to the upside, as bullish sentiment for AAL will continue to be fueled due to reopening optimism.
NASDAQ:AALLong
by ZaviStocks
🔹$PFE 4H Technical Analysis PT 37.28🔸 $PFE 4H Cup & Handle Breakout. This is a **SOLID** setup for this week. I am looking at a 2 week swing for $PFE price target 37.28 on that solid gap fill. Now, the chart looks absolutely beautiful not only that but we have a catalyst play $PFE. We have the PDUFA date on April 28th. I am expecting a run up for that event as well as to fill the gap to the upside. 🔸 Swing* 36.50c 4/30 ( Looking To Get @ Open ) Really Cheap also looking to sell before the event or until we hit our price target on that gap.
NYSE:PFELong
by Firecycle114
1