Tuesday, February 17, 2009

BGZ Trade Entry and Update

This morning the markets gapped way down. This gap down caused BGZ to gap up sharply to 73.63 at the open. That is the entry price I will use for blog purposes. However, it may not have been possible to place a buy stop order at 72.00 this morning, so I am going to try to follow up over the next week for an additional quality entry on BGZ, but I will not track that on the blog.

For today, anyone could place a buy limit order at 73.63 on BGZ to try to get in at the same price as today's open. However, when SPY gaps down >2% there is a strong tendency for prices to close above the opening price of that gap within 3 or 4 days. That would suggest that there is a good chance to get in at 73.63 or better on BGZ sometime this week or early next week. Take a look at the following link about large gaps in SPY from the Quantifiable Edges blog

http://quantifiableedges.blogspot.com/2009/02/2-gaps-down-revisited.html


Pete

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