Gap Fade: Monday 04/17/2006

[eliteG]

Good morning 

Lets see what the futures say:

"09:00 am : S&P futures vs fair value: -0.3. Nasdaq futures vs fair value: -2.0.  Futures trade continues to vacillate around the unchanged mark as investors continue to sift through the first big batch of Q1 earnings. Even though most of today's reports have checked in better than analysts' forecasts, the market, per usual early in the earnings season, remains cautious until an assessment on trends and guidance is possible.  "

So we will have to see if the market gives us a nice gap... if it does not I will probably not call any gap fade.

Here are the gappers:

[eliteG]

No big market gap.. so it makes the gaps difficult to play.  I will check if any nice setup presents itself.

[eliteG]

ISIL triggers short if it prints 29.09 

[eliteG]

ISIL - triggered short @ 29.09.. buy stop @ 29.27 

[eliteG]

Our gap fade ISIL has begun to enter its gap  ..

[eliteG]

Now thats what I call a gap fade!    We are +.50 on this short! 

[eliteG]

I am going to get agressive and put my buy stop @ 28.59.  That would be a .50 gain but in case this drops lower we can pocket that as well.. target cover is 28.30.  With 1000 shares this is at least $500. 

ISIL 4/17/2006
short @ 29.09
buy stop@ 28.59
limit cover @ 28.30

[eliteG]

ok our short on ISIL is complete.. +.50!

Let me know if you have any questions on this method. 

Thats 1 for 1 this week.  Lets see if we can put another win under our belt tomorrow! 

Total
Winners: 1
Losers: 0
Gain/(Loss) = +0.50

[eliteG]

Gap Fading theory and examples can be found here:

http://www.3stocksonfire.org/trading/index.php?topic=5152.0

[echo]

You da man, G!!

Pocketed a cool 500 in one day. Maybe I should quit my day job and play the "fade the gap" game

[eliteG]

You da man, G!!

Pocketed a cool 500 in one day. Maybe I should quit my day job and play the "fade the gap" game

That makes my day ultra!  .. lets get you another 2k this week    Great trade.