I am not really sure what significance this has. All I know is that I have never seen a super market from this point of view. Its kind of creepy isn't it?
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I am working on a strategy known as filling the gap. This is nothing new but I dont think many traders focus on it. If not a lot of people are doing it, then its bound to be successful. I noticed this pattern when I was trading RACK.
Stocks usually fill their short term gaps. A gap is when a stock makes a large jump either up or down and leaves what looks like a gap in the chart. Sometimes this happens because of news, and sometimes it happens for no reason at all.
Now there are some rules that go along with this. Not every gap gets filled. 1) Never trade this strategy on a big gap down. I would consider a big gap anything over 20%. These usually occurs because of a news release. Keep your eye on that news. 2) Sell once the gap is filled. Our strategy is to fill the gap, if you want to hang on to the stock after the fact, you will need another strategy/reason.
The market is opening on my side this morning. I own two stocks right now, AAPL long and UA short. AAPL opened up over $1 and UA is down 2% all in the first 3 minutes of the market. After it rally'd with the market on Friday, I was worried UA would start trending against me. This morning's action verifies that it is not. It broke its short term support on unusually heavy volume and kept going. Traders picked it up at $45 and ran it back up to its short term resistance at $46 at the same time as the market turned green. I believe it will bounce off of 46 and trend lower. If it gets above 46.08 then it might start going green.
feed my brain...
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