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They say that the tortoise, or tortuga, starts off the race slowly, but steadily plods along and eventually overtakes the hare. As a swing trader, I almost always refrain from making trades during the opening thirty/forty-five minutes of the session. The reason for that is because volume is usually exceptionally light, and stocks are prone to wild and random fluctuations. Indeed, it is too easy to buy a breakout or short a breakdown at the opening bell, only to see if scream in the other direction within a few seconds. Without question, respecting this discipline has eliminated plenty of mistakes that I otherwise would have made.
A good example of what I am referring to is a stock that I had discussed with 12631 members late last week. STMP looked to trigger a breakout above $28.84, with plenty of shorts in its float to squeeze. This morning, STMP opened strongly and went over $29 within the first few moments of trading. So, let’s all fly in and buy at the open, right?!
Not quite, since volume was so light. As you can see, STMP actually faded hard, and might present a much better, and safer, entry if it gets going higher again with more liquidity this afternoon. In fact, I made this note to 12631 members inside our chat room–Note the timestamp, just a few moments after the opening bell (disregard the coding, please).
chessNwineLots of setups triggering. Watch $STMP here as more volume comes in to see if $28.84 can hold.09:41:39am EST on Mon, Mar 26, 2012
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Good stuff. side note – great images/videos last few posts! Still laughing over the Cat post and video, and agreed, anyone truly following you has their head together about what trades and entries/exits fit their own style or not.
Completely unrelated to share price and where it will be in the future, stamps.com as a business and their business practices are a steaming pile shit. Just google something like ‘Stamps.com Scam’.
Trade this company all you want but I would warn you against doing business with them.
russian turkey~ well i wouldn’t be as harsh but STMP fell off bout everyone’s watchlist beginning of Febuary with the failed report. regardless of any current price action, wouldn’t be messing with it, a very difficult stock to trade as this author found out.