I’m looking for action in this stock
Here is the advantage of using a fast
breaking news service. I have mentioned in prior articles that the fast break
news service is only for the hyperactive trader. On the other hand I have heard
from a couple of active swing traders that watch the markets intently all day.
They are listening for news relating to positions they hold. The newsreader has
allowed them to exit positions 20 to 30 seconds before the news has been
disseminated hit the wire services.
Today, a news event happened late in the afternoon with about 15 minutes to go
before the NYSE close.
My newsreader announced that DNA was getting some bad comments from Bear Stearns
Corporation. As quickly as I could pull up a quote and chart, I could see the
large offers in the NYSE openbook as well as all the individual ECNs. DNA
dropped 2 points so quickly, there was not even a chance to get short on the
ECNs. The sell off was from 83.50 to 81.50. I realized from my 5-minute DNA
chart that DNA was close to the previous day low of 81.40. I bought DNA at this
point. But when the stock failed to bounce, I took a quick .25 loss. I flipped
my position to the short side as the price fell through the 81.40 mark. DNA was
crossed down to 81 and sold off down to 79.85 where I covered just before the
NYSE close.
After hours DNA continued to be crossed down to 79.00.
I will be looking for DNA to be extremely active tomorrow. Once the news is
disseminated a bit more over-night I will look for DNA to be a little bit easier
to read. I will not form an opinion based on the news but I will be aware of the
news and look to take advantage of quick moves in DNA either to the long side or
short as the markets digest the information.
Mike Kestler
Pease e-mail with any
questions you might have at
mkestler@evotrading.com
Michael Kestler is a
full-time professional trader and managing partner for Evolution Capital LLC., a
proprietary trading firm. Mr. Kestler specializes in intraday trading of NYSE
listed stocks.
Before founding Evolution Capital LLC., Michael began his career on the floor of
the CBOE. Mr. Kestler was previously a Mid-Cap and Nasdaq Market Maker.
www.evotrading.com