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Jeff Krenz wrote:
> >I would suggest "stock patterns for day trading" by Barry Rudd
>
> I have received that book and I am promptly returning it for a refund. I
> would not recommend it as the examples of charts to trade off are all
> ILLIQUID!
I haven't read the book, but I'm familiar with Barry, and while he doesn't seem
all that sophisticated, newer traders could probably pick up some valuable
info. What struck me about this reply, though, is that I'm wondering how
"illiquid" is being defined here. Sure, there are plenty of stocks out there
which aren't liquid enough to be day traded, but my impression is that many day
traders place far too much weight on trading volume. Typical spread is far more
important here, and as long as there is enough volume on the b/a and the spread
is tight, and there is at least a trade every couple of minutes or so on
average, then there is no reason why the play would not be viable. In fact, the
quieter plays have the advantage of being more stable, and thus can be traded
with less risk. Besides, patterns in charts have little to do with liquidity
anyway.
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