When To Buy Relative Weakness
It’s a small niche or what some might
call a ‘micro-strategy’. The Opening Reversal plays give you a very small
time window from which to operate, but if you’re prepared to act ahead of time,
it might just be the only strategy you’ll ever need.
Microstrategy
(
MSTR |
Quote |
Chart |
News |
PowerRating) was on my list
of stocks to watch for continued downside action in today’s trade. The initial
action this morning more than made good on the anticipated direction, as the
stock gapped lower into price supports on the daily chart. As we all know, all
things must eventually come to an end, and when technical levels are involved,
it was time to look for potential long
reversal plays in the here and now.
09:36:07
Intraday
Setup Alert
From the Nightly Daytraders
Report Microstrategy (MSTR)
has gapped lower into potential price supports. Session lows are at the 62%
Fibonacci cycle from the May lows, as well as trendline support from late
January. With the stock off more than 1.25 at 33.60 we are looking for potential
reversal setups.
The opening bars ended up forming a very volatile price range, but
technically we could still discern some strong evidence of a potential reversal.
By the close of the second price bar, the first 10 minutes of trade was looking
very much like a ‘Kings & Queens’ pattern. I say ‘looking’, because in my
humble opinion, the intent of the second bar was showing itself as a reversal
bar for entry. Too aggressive for entry? I’ll leave that up to you the viewing
audience, but I have heard on more than one occasion that, that which is
perceived as being too risky is actually much less so than one thinks.
…but once again, the textbook version of an Opening Reversal presents
itself by the third bar, with the alert going out in TMs
chat room. One bar later the classic trigger establishes itself on the
fourth 5-Minute bar.
The stock proceeds to run up over 1.5 points and triggering in the process,
possibly ‘a little something’ new in your own daytrading repertoire.