Notice the increase in volume today as we have the first significant down day this month. The fact that we have higher volume when stocks are selling off shows strength for the bears.
Thursday, November 19, 2009
Potential Buying Opportunity or Scalp Play?
We are watching a nice drop in the market this morning with SPY moving down more than 1.7% in early trading. We are seeing what could be minor support now at $109.35. I look to see SPY break through this support to move a little lower. I will be looking to buy at potential lows for the day between $108.95 and $109 for a nice Scalp play. Depending on your risk to reward, you could put anywhere from a .10c stop to a .35c stop. Look for potential gains of .70c on this play.
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In fact, after buying at $109 (if we get there), if SPY goes down to further $108.72, I will double my position. From here I will have a very small stop, maybe between .10c and .15c. So if the price continues any lower than $108.60, I will probably unload the entire position.
ReplyDeleteThis trade is now off the table. It no longer comes into play as we approach the last 1/2 hour of trading. Earlier today we were .13c off of our $9 target entry. Its ok, no trade is better than a losing trade, we don't chase trades. There were however several opportunities to trade within the range of $109.35 and $109.70
ReplyDeleteVolume trailed off after the open and the SPY saw less than 200 million shares traded. Still a low volume day in the end.
ReplyDelete