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Wong,
All this is IMO, playing the news. Nothing new, just a fancy name. Being a
trader who uses TA and some type of rules, I do have to question the written
passage.
"Price Shocks have No Rules or patterns that can be applied in advance." --Just
roll the dice.
"Because they are always unexpected, then can occur anytime during any
market"--So, he thinks the markets are random????
IMO this will hurt you. A stock that shoots to the moon, example: from 2-50 in
one or two days. This is something you short. That day or the next. A blue
chip stock comes in with bad earnings and the price drop in afterhours, you need
some type of rules for entry and exit, for that day or next. Otherwise the stock
chart can look like : S, KM, GT, MO.
Just my thoughts,
Joe Frabosilio
wong wrote:
> Hi All:
>
> Though this is a general topic, for me, it's more for the stocks than futures.
>
> Here's an extract from Kaufman's "Smarter Trading" on price shock. (It
> runs on for a number of pages more.)
>
> We've witnessed a number of high-flying stocks like QCOM, LU, EMC, AMGN...
> that have quarterly reports or other news and then ... wow ...
>
> I don't know how to read charts accurately, so I'll leave this to the
> experts here.
>
> If we can identify which stocks have the type (c) formation (cf the
> attached file) - a "false" shock, and be ready to enter long on some of
> these "fallen angels", either stock or leaps/calls, we'd stand to gain a
> lot....
>
> Any follow-up?
>
> Regards,
>
> Wong
>
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