Which Gap Is It?
All gaps are not the same. Some are prone to failure, while others signify
momentum. This morning before the bell, ArQule Inc.
(
ARQL |
Quote |
Chart |
News |
PowerRating) announced
news of an extension of its business alliance with Pfizer
(
PFE |
Quote |
Chart |
News |
PowerRating), and
the various ways it would benefit from the agreement until 2008. The stock
gapped on the open on a huge surge in volume. Soon after, an intraday alert went
out in the Insights From The War Room.
09:46:08
Intraday Setup Alert
ArQule (ARQL)
is pulling back from highs. ARQL is trading at 15, up 2.79.
Following the big volume/price surge, the stock pulls back and
volume lessens, as traders take profits after the push higher. A second volume
spike gives confirmation that the buying is not over, as it rallies out of the
pullback alerted in the post.
There are three ways to play gaps,
trade them, fade them or ignore them. Learn to recognize which way to go,
and opportunities will abound.
Have a wonderful Christmas holiday!