Mouse Moves
First entries are not always the best entry. A trader friend of mind liked to
say “the second mouse gets the cheese." We saw a good example of that
today in Gilead Sciences
(
GILD |
Quote |
Chart |
News |
PowerRating):
10:09:32
Intraday Setup Alert
Gilead Sciences (GILD)
is forming a pennant at the high on the five-minute chart. GILD is up 1.61
at 51.41.
The original pattern did not play out. It turned into a pullback and did
trigger, but drifted sideways and never took off. However, it did form a Slim
Jim during the period.
The stock did a brief head-fake to the upside before going back
into the consolidation and then undercutting the slim, wedging triangle. After
that, the stock makes a run to higher ground.
GILD gains almost 1 point out of the pattern following the
undercut. I use this as an example to show how sometimes re-entering can be the
best play of the day, even though this specific pattern was not profiled in
today’s Insights From The War Room. You
should always honor protective stops when the trade moves against you, and this
shows why. It is much cheaper to pay a second commission and get back in than
suffer a big loss in the event a stock misbehaves.
Have a great weekend,
Duke