When Failure Is Not
I don’t want to get into the habit of telling you to do the opposite what we
point out as setups in the Insights From The War
Room, but in many instances, a failed signal will tell you just as
much about which direction a stock is headed.
Intraday Setup Alert
Microsoft (MSFT)
is gapping lower after being downgraded by Wit-Soundview. MSFT is setting up
for a potential opening reversal after the company cut its rating, due to
concerns for 2003. MSFT is down 0.90 to 46.58.
When MSFT fails out the opening reversal, the stock goes into a
short-term free fall before stabilizing. If you were not quick enough the catch
the first big bar down on the failure, you should be able to play the
continuation move when the stock moves out of a triangle at the intraday low.
Being a trader is not about being right or wrong. It is about
assessing probabilities and acting when price action is telling you those
probabilities are in your favor. “Failure” in my book is not that at all, but
yet another opportunity.
Until tomorrow,