In last night's Technical Picture post, I noted that if the market did not snap back in the early going today, it could be heading towards Nasdaq 2100. With that in mind, I held off trading for the first hour. Shortly after 10:30, it became obvious, that the market was too weak to snap back from yesterday's big loss, so I looked for a weak candidate to short. Since I only have about 10 stocks on my web trader page at work, BRCM stood out from the rest. I put in a sell limit order and was filled right away. I covered near the close - good for 1.25 pts.
Tuesday, June 06, 2006
Trade of the Day - BRCM
In last night's Technical Picture post, I noted that if the market did not snap back in the early going today, it could be heading towards Nasdaq 2100. With that in mind, I held off trading for the first hour. Shortly after 10:30, it became obvious, that the market was too weak to snap back from yesterday's big loss, so I looked for a weak candidate to short. Since I only have about 10 stocks on my web trader page at work, BRCM stood out from the rest. I put in a sell limit order and was filled right away. I covered near the close - good for 1.25 pts.
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2 comments:
Nice one. Jamie, may I ask how you know not to cover after the intial nice gain and or when it started reversing noon to 1ish?
Glenn
Hi Glenn,
BRCM broke support at $33.00 on high volume and this was a pretty good indicator that it was going to have a really bad day. Because BRCM has not traded at these low price levels since Dec. 2005, there is no intraday support. My target was $31.00 - support dating back to Dec. 30th. My stop was set at breakeven and it was all or nothing, if you know what I mean.
However, if I was daytrading at home, you're right, I would have taken a 50% profit on the first bounce around noon. Fortunately for me, I was too busy at work and the noon day bounce was out of sight and out of mind because of the protective stop.
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