What Happens When A High RS Stock Takes Out A Pivot?
In our Nightly Reports on the home page,
we try to give you good candidates for the following trading day, covering stocks,
options, and futures. Shortly after the open today, we posted this in TradersWire:
09:47:14
Intraday
Setup Alert
Omnivision (OVTI)
from the
Nightly Daytraders Report
is up .68 at 18.25. The stock was listed under High RS stocks and looks
to be continuing its uptrend. With today’s early trade the stock has taken out
an upside pivot point of 18 from Dec. 6.
The stock proceeded to trade up for several
hours. A quick glance at a daily chart (not pictured) shows what Chris was
talking about when he said the pivot was taken out, which reinforces the drill
of looking at daily charts when considering day trades. The last thing you want
is a fairly good looking intraday setup that gets hammered a few minutes later
by some resistance.