Price Action Near The Low — An Example From AIG
So often short sellers
try to take profits when a stock reaches its recent low. Because of
this buy back action, the stock begins to pull back from the low, and it creates
another selling opportunity. Â
11:25:00
(From TradingMarkets TradersWire)
American International Group (AIG)
is nearing the September 30 low after gapping down at the open. AIG is trading
at 67.64, down 0.85.
Look at the price action shortly before the alert. Sellers began to cover their
short positions as the stock reached its target, and it caused the stock to form
a bear flag just below the declining 20-period MA. Because of the uptick rule,
it is easier to sell when the stock is pulling back.
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Watch closely when a stock is trading near the prior low.
Have a nice afternoon trading session!
If you have questions, feel free to mail them to me.
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