Pulling Out The Rug
All of you should now be familiar with the Connors News Reversal strategy.
The method is a great way to take advantage of stocks that gap higher or lower
on earnings or news events specific to a particular company. The downside of the
strategy is often if the gap is too big, it will not trade back through the
prior low or high and meet the entry criteria for a News Reversal. That does not
mean, however, that you cannot take advantage of stocks when they bleed back
into the gap when momentum fails.
10:14:52
Intraday Setup Alert
CVS Corp. (CVS)
is breaking down following an opening gap. The company reports Tuesday
morning it sees its earnings coming in at the high end of the estimated range.
CVS is up 2.40 to 26.40.
The stock continues to slide nearly 1 1/2 points
following
the alert, before bouncing in the afternoon. When fading large-range gaps like
this, it is a good idea to make sure the stock breaks down below the open if you
are going short, and look at the indices or the futures for confirmation on
overall market direction.
Until tomorrow,