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When evaluating patterns around gap days, it is best to use the true
range of the day which begins at the prior day close. Now you have
Friday as a long range day and Monday as a continuation rather than an
outside day. Never-the-less, a day which opens higher and closes lower
is bearish. A simple ABC using the high of 01Sep, low of 18Sep and high
of 20Sep projects to 43. A true bearish impulse at 162% projects to 30+.
I would watch 43 for any signs of a bullish reversal on volume and if
there is none, look out below.
Isn't it interesting how the initial price decline clearly preceded the
news and subsequent rally failed at the 38% retracement. Clearly the
word was getting out long before the announcement.
Earl
----- Original Message -----
From: "Gitanshu Buch" <OnWingsOfEagles@xxxxxxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Sent: Monday, September 25, 2000 2:31 PM
Subject: [RT] STKl INTC
> Outside day with a close in bottom of range and afterhours
follow-thru, INTC
> now trading with a 44 handle.
>
> I wonder if such bearish patterns work after the huge gap down.
>
> Gary B Smith over at TheStreet.com had done some research advising
against a
> buy in the 1st big news-driven gap down... I guess this proves his
point.
>
> No position.
>
> Gitanshu
>
>
>
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